VW audits EV supply chains back to mines
Wants to ensure e-mobility materials are sourced responsibly Metal Tech News – September 16, 2020
Last updated 9/22/2020 at 5:04pm
With the goal of selling more than 1 million electric cars per year by 2025 and having 75 all-electric models by 2029, Volkswagen Group is taking steps to ensure that the array of battery metals and rare earth elements needed for this e-mobility transition are sourced responsibly. The German automaker is also taking steps to minimize the carbon footprint of manufacturing its expanding line-up of EVs.
Convinced that a sustainable supplier network is vital to long-term corporate success, especially when it comes to e-mobility, Volkswagen has entered a strategic partnership with RCS Global, a leader in supply chain analysis and auditing.
RCS will audit Volkswagen raw material supply chains for conformance with human rights, safe working conditions and environmental protection along the supply chain all the way back to the mines.
"The cooperation with RCS Global helps us to better understand which raw material sources and suppliers are in our supply chain and to measure their responsibility performance," said Volkswagen Group Head of Procurement Strategy Ullrich Gereke.
Volkswagen introduced a sustainability rating for direct suppliers one year ago. RCS Global will now apply its comprehensive supply chain auditing and mapping system to track adherence to sustainability criteria at sub-suppliers, refineries, smelters, mines, and recyclers.
"In direct contact with our sub-suppliers, we can better explain and monitor our expectations of responsible sourcing and better follow up on agreed measures following our sustainability audits," says Gereke.
Volkswagen has issued new guidelines that require suppliers to take actions to clean up the supply chain when risks and shortcomings are identified. Serious audit violations may even lead to the disqualification of suppliers from the supply chain. On such violation is sourcing cobalt or other materials from small-scale mining operators when child labor cannot be ruled out.
RCS Global has already identified 134 sub-suppliers and 18 mines in the Volkswagen Group's battery supply chains, and the majority have already been audited. The expanded partnership has also enabled the development of due diligence measures for each type of relevant raw material by means of a comprehensive management system, despite the large number of companies in the supply chains.
In addition to taking steps to provide assurances that the materials are sustainably sourced, Volkswagen has taken steps to ensure its ID.3 and the ID.4 electric models are produced and delivered to customers with a carbon-neutral footprint.
For the ID. family models, Volkswagen focuses on the entire lifecycle of the electric car – from raw material extraction to production and recycling.
The German automaker has simple but clear policy to guide this: wherever possible, carbon dioxide emissions are avoided. If CO2 emissions cannot currently be avoided, they are reduced as far as possible. All unavoidable emissions are offset by investments in climate protection projects.
All outsourced electricity delivered to the Zwickau factory, where the Volkswagen ID.3 and ID.4 EV models are being manufactured, is 100% green power.
The plant also operates its own highly-efficient block-type thermal power station with combined heat and power generation.
Production of the lithium-ion battery cells going into Volkswagen electric vehicles, which are purchased from third party suppliers, is inevitably energy-intensive. For that reason, Volkswagen has stipulated that its cell suppliers must exclusively use green power in their manufacturing processes.
"With the strategic goal of becoming the world's leading provider of e-mobility, focusing on consistent decarbonization can be a strong competitive advantage," said Georg Kell, spokesman for Volkswagen's independent sustainability advisory board. "In any case, it offers the best way to set the course for a joint path to a secure and economically successful future on a planet worth living on."