Why Car Makers Drive Sustainability

I am pretty much a Luddite when it comes to cars. The average age of my home fleet of three is 2003. Still, when I read about what was on display at the 64th annual Frankfurt Motor Show, I was amazed to see how many automakers are using modern manufacturing technologies to build cars that protect the environment, develop strong ties with customers, lower business cost and increase revenues.

True, there is much debate about what energy source will power next-gen green automobiles. But car makers at the Frankfurt show all seemed to agree on one thing: vehicles are going to become lighter. At least that’s the view of New York Times reporter Jerry Garnett who wrote that “at every display, company representatives were eager to explain their efforts to make every component, down to the smallest screw or rivet, as light as it could possibly be and still do its job.”

The industry shift to lightweight auto designs is just one example of how car makers are getting their sustainability act together. There are others. In a report published in May by Accenture and the UN Global Compact, a total of 766 automotive CEOs surveyed were unanimous in their belief that resolving sustainability issues will be critical to the future success of their business. A full 95 percent said sustainability should be fully integrated into their company’s strategy and operations.

Some other findings from the automotive sector CEO study:

  • Seven out of ten CEOs cited “brand trust and reputation” as one of the top three factors driving them to take action on sustainability issues.
  • Two-thirds identified consumers as the most important stakeholder group that will impact the way they manage societal expectations about sustainability.
  • Three-quarters of the execs said competing priorities were one of the most significant barriers to embedding sustainability in product development.
  • While 86 percent agreed that companies should integrate sustainability through their supply chain only 57 percent said their company had done so.
  • The car industry chiefs all said they planned to deploy new technologies that address sustainability issues over the next five years.

The last three points—competing priorities, supply chain and technology—are examples of some of the most  pressing concerns all manufacturers face as they juggle a myriad of product development issues, according to “Designing Products for Compliance, Cost, and Sustainability,” a study by Jim Brown of TechClarity, an independent research and consulting firm that specializes in Product Lifecycle Management (PLM) and other enterprise technologies.

Brown looked at product development tradeoffs made by over 100 manufacturing companies, then identified a hierarchy of the six issues with the most significant business impact: product quality/reliability, product cost, environmental regulatory compliance/hazardous substances, supply chain/component availability /obsolescence, manufacturability assembly, and product sustainability/green initiatives.

The TechClarity research also revealed common roadblocks that survey respondents said prevent designers from assessing the impact of their decisions early in the product development cycle – a lack of effective tools to collect the data they need, and having that information available when they need it.

These are just two of the issues manufacturers—automotive and others—will face as they travel down the road of integrating sustainability into core businesses. Judging by evidence on display on the showroom floor in Frankfurt, car makers are already seeing results in their nascent journey.

Is your company on a similar path? Share some of your challenges and successes.

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