GM Surges toward Sustainability Success with Supply Chain, EVs, Circular Economy

by | Jun 14, 2018

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General Motors has surpassed its 2020 goal of reducing the carbon intensity of its operations by 20%, three years ahead of schedule, the company announced in its just-released 2017 sustainability report; since 2010, GM has reduced the energy intensity of its operations by 15%, generating $135 million in cost savings.

GM’s chairman and CEO Mary Barra says the world is in the midst of a “transportation revolution,” and that General Motors has the right tools, technology, manufacturing scale, and partners to lead the revolution and achieve a future with zero emissions, zero congestion and zero crashes.

Sustainability Advancements

Improving fuel efficiency: General Motors continues to improve efficiency of its traditional vehicles with advances in engine and transmission efficiency, aerodynamics, vehicle lightweighting, and other technologies to reduce fuel use and cost. Since 2016, GM says it has shed more than 5,000 pounds across 14 new-vehicle models, saving 35 million gallons of gasoline and 300 thousand metric tons of CO2 emissions per year.

All EVs, all the time: GM is moving closer to an all-electric portfolio, with at least 20 new, all-electric models launching globally by 2023. In response to global demand, Bolt EV production will increase this year.

Robust charging network: GM is partnering with utilities, communities, governments and others to accelerate the charging infrastructure while working to increase consumer acceptance. In the US, EVs from all manufacturers can access about 17,000 public charging stations — including about 2,000 DC fast chargers. “But more will be needed as more consumers discover the benefits of EVs,” according to the report. “We’re committed to working with utilities and other partners to accelerate the availability of chargers.”

Advancing EVs in a massive market: China, currently the world’s largest market for electric vehicles, is an important part of the company’s strategy, GM says. By 2020, General Motors plans to introduce at least 10 plug-in hybrids or EVs in China, and has already launched the Buick Velite 5 extended-range EV, Cadillac CT6 Plug-in and Baojun E100 battery electric vehicle and introduced the Buick Velite 6 plug-in hybrid and Velite 6 EV.

Accelerating and scaling renewable energy: GM says “progress continues” on its pledge to source 100% renewable energy for its electricity needs globally by 2050. The company uses 371 megawatts of energy from renewable sources now, and by the end of 2018 renewable energy will power 20% of the company’s global electricity use.

Waste Reduction Leads to Circular Economy

Waste reduction and landfill-free initiatives have been among GM’s most significant areas of achievement, according to the company. But while the company’s plants have made tremendous progress, those manufacturing facilities represent only one phase of the product life cycle.

“We need to move toward a more systems-based approach that goes beyond the GM enterprise to take into consideration the materials used in our vehicles,” says David Tulauskas, GM’s director of global sustainability. “That process begins with vehicle design and extends through end-of-life. It requires engagement with suppliers through every tier of the supply chain and the communities in which we operate – all with the objective of finding uses for our products that require minimal additional processing and that contribute to a more circular economy.”

Challenges (and Benefits) of the General Motors Hefty Supply Chain

Every year, GM sources nearly $100 billion worth of products and services from 20,000 global suppliers. Roughly 65% of the company’s cost structure is reserved for purchased materials and the logistics involved in moving these materials around.

This scale creates considerable complexity in getting its supply base aligned with the company’s sustainability priorities. In order to improve the environmental responsibility of its suppliers, GM says the company is getting more disciplined about communicating the company’s expectations down multiple tiers, including a commitment to having one-on-one conversations with suppliers.

But while that can be challenging, it also means the company has the opportunity to “have a great sustainability impact as we encourage our suppliers to improve on different issues,” says Steve Kiefer, VP global purchasing and supply chain with GM. By communicating throughout Tier I and Tier II suppliers and encouraging them to mobilize their own supply bases, “we have a huge opportunity to impact the environment,” he says.

External rankings help the company understand how it compares to others in the industry in terms of supply chain sustainability. General Motors says its ranking in the Planning Perspectives Inc. Supplier Relations Study, a well-known study that quantifies suppliers’ working experiences with companies, improved 16% in 2017, bring its standing to third place. “Another benchmark we pay close attention to is the Gartner Supply Chain list. We haven’t cracked the top 25 yet, but are aspiring to getting there soon,” says Kiefer.

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