Volvo Cars is expanding its sustainability strategy, setting new ambitious goals for 2030 and 2040. The company is also boosting its focus on biodiversity, and by 2025, the company aims to have 100 per cent of its debt linked to its Green Financing Framework or in a sustainability-linked format.
This pledge comes on the heels of a landmark partnership between Volvo local partner, Al-Futtaim Group and COP28 last year, where the group was named Strategic E-Mobility Partner for the historic global gathering.
Al-Futtaim Group’s participation at COP28 is a resounding testament to its dynamic leadership across core economic sectors in the UAE and the group’s long-standing commitment to sustainability. Al-Futtaim Automotive, one of the major divisions of the Al-Futtaim Group, has an ambition to deliver 50% new energy vehicles (NEVs) and install 10% of the charging stations in the UAE by 2030.
During COP28, Al-Futtaim Automotive launched the all-new fully electric Volvo EX30 in the UAE. The company is also slated to launch the all-electric EX90 towards the last quarter of 2024 to further enhance its EV model portfolio. These measurable actions as well as amplifying Volvo’s green goals in the region reinforces Al-Futtaim Automotive’s commitment to sustainability and the market’s unwavering demand for the fast-growing EV segment.
“Taking actions to combat climate change is non-negotiable and going fully electric is an important step on our pioneering journey,” says Jim Rowan, CEO of Volvo Cars. “As we move to further reduce emissions throughout our value chain, we have a responsibility to do more and address our biodiversity footprint as well as help improve people’s lives. Our updated strategy has been designed to help us do just that.”
Volvo Cars’ new sustainability ambitions for 2030 in short:
- Reduce its CO2 emissions per car by 75 per cent (compared to 2018 levels).
- Reduce energy usage in its operations per average car by 40 per cent (compared to 2018 levels).
- Reach 30 per cent average recycled content across its fleet, with new car models having at least 35 per cent recycled content.
- Reduce water use in its operations by 50 per cent average per car (compared to 2018 levels).
- At least 99 per cent of all waste from its operations to be either reused or recycled.
Since the release of the sustainability strategy in 2019, Volvo Cars has made progress towards its climate action targets. For example, 69 per cent of company operations are now powered by climate-neutral energy compared to 55 per cent in 2019, and 100 per cent climate neutral electricity is now used across its manufacturing plants globally, compared to 80 per cent in 2019. Additionally, Volvo Cars has reduced its CO2 emissions per car by 19 per cent since 2018.
Net zero greenhouse gas emissions by 2040
Volvo Cars’ aim now is to reach net zero greenhouse gas emissions by 2040. This expands upon our previous ambitions of being climate neutral by 2040 and clarifies the company’s intention to use carbon removals only to mitigate any unavoidable emissions. The company’s first priority remains to reduce real emissions before turning to carbon removals and encourages its suppliers to do the same.
This will be underpinned by an ambition to achieve 100 per cent green debt or sustainability-linked financing of assets by 2025 – in recognition of the fact that finance plays a critical role in advancing sustainable development.
2030 is a milestone year for the company. By then it plans to be a fully electric car company while also aiming to reduce CO2 emissions per average car by 75 per cent compared to its 2018 baseline. The company believes that through a combination of only selling fully electric cars and reducing emissions by 30 per cent from both its supply chain and operations per average car, it will be on track to meet the CO2 reduction goals.
Working towards becoming a circular business by 2040
At Volvo Cars, embracing the circular economy has been in focus since 2019. Recycled material already comprises a larger proportion of materials in newer Volvo cars than ever before. For example, nearly 25 per cent of all aluminium in the Volvo EX30 is recycled while approximately 17 per cent of all steel and plastic in the car comes from recycled sources as well.
Volvo Cars aims to use 30 per cent average recycled content across its fleet by 2030, and for new car models released from 2030 to contain at least 35 per cent recycled content. The company is also striving to ensure that by 2030, 99 per cent of all its waste is either reused or recycled compared to recycling 94 per cent of global production waste in 2022.
Striving to be net positive and to contribute to a nature positive future
Volvo Cars believes in taking a complete value chain approach to its impact on biodiversity. In addition to taking action to reduce impact, it will also pursue restorative actions.
To uncover how Volvo Cars’ actions affect biodiversity, the company conducted an impact assessment using production and sales data from 2021, to estimate its annual biodiversity footprint using the ReCiPe model. Using the findings as a baseline, Volvo Cars is now setting a long-term ambition to strive to be net positive across its value chain and to contribute to a nature positive future.
This will require a mixture of short-term and long-term measures that Volvo Cars is currently developing, such as avoiding and reducing the impacts of its value chain, designing a programme for restoration and conservation activities within ecosystems where it operates / sources from, and working together with supply chain partners to establish awareness on biodiversity issues.
Help protect people’s lives within and beyond the value chain Volvo Cars wants to have a positive impact on society. The company has for example taken steps to help protect people by focusing on its injury rate (LTCR). The current injury rate (LTCR) is 0.07, an industry-leading effort, but the goal is to further reduce the workplace injury rate to 0.02 by 2030. Throughout its value chain, Volvo Cars is also working hard to help safeguard human rights through risk-based due diligence processes to trace, identify, assess and address human rights risks.
Together with like-minded partners, Volvo Cars looks forward to unveiling new social and environmental initiatives in the year ahead, aimed towards helping protect people and the planet.
The small print
- On across its fleet by 2030: This refers to all models currently being produced at that time.
- On net positive across its value chain: Aiming towards net positive means that Volvo Cars will take actions to avoid and reduce its impacts, as well as engage in restoration and regeneration of nature to the extent that it positively balances its negative impacts.
- On nature positive: Volvo Cars’ aim to contribute towards nature positive means that it will not only aim to be net positive but also aim at continuously reducing its negative impact relative to a 2021 baseline.
- On injury rate (LTCR): Injury rate (LTCR) is defined as the number of work and occupational accidents reported with at least one day sick leave, divided by hours worked and multiplied by 200,000.
- On risk-based due diligence processes to trace, identify, assess and address human rights risks: Risk-based due diligence processes implemented globally to assess the potential or actual adverse impact and prioritise actions to cease, prevent, mitigate and remedy identified human rights violations. The processes should fulfil upcoming EU Corporate Sustainability Due Diligence Directive (CSDDD) and its human rights compliance programme. This includes a responsible sourcing management system aiming to introduce a formalised and consistent process to proactively manage human rights and environment-related risks in Volvo Cars’ supply chains for all its identified Raw materials of concern (RMOC)
- On together with like-minded partners: Recent examples in this space are Volvo Cars’ financial and in-kind support to Save the Children and UNICEF’s Ukraine response and collaboration with Girls Who Code.
About Trading Enterprises – Volvo
Trading Enterprises, part of Al-Futtaim Automotive, is the exclusive distributor of Volvo cars in the UAE since 1985. The ISO9001:2008 company represents the world-renowned Volvo cars brand well known for its intuitive innovations, safety, environmental performance and Scandinavian design through its sales and after-sales network in Dubai and Abu Dhabi.
Trading Enterprises – Volvo offers a complete range of premium mobility solutions in the premium segment that includes Sedans (S60 and S90), SUV vehicles (XC40, XC60 and XC90) and the fully electric EX30. Trading Enterprises is regarded as pioneers in the region by Volvo when it comes to adopting Volvo best practices and has introduced the region’s first Volvo Retail Experience Showroom and Volvo Personal Service – which offers a human-centric approach to sales and service.
About Al-Futtaim Automotive
Al-Futtaim Automotive, one of the main five operating divisions within the UAE-based Al-Futtaim Group of companies, is a conglomerate of motoring-related businesses, franchising some of the world’s most-recognized automotive brands and services.
Operating in 10 countries across the Middle East, Asia, and Africa and empowered by around 9,000 associates, the UAE-headquartered Group’s services span the distribution of new and used vehicles, manufacturing, leasing, and aftersales.
Ranging from passenger cars to SUVs, commercial vehicles, industrial and construction equipment as well as motorbikes and quads, Al-Futtaim Automotive Group offers an integrative customer-centric experience for motorists, fleet operators, and contractors alike, and strives to become the leader in tailor-made mobility solutions
About Al-Futtaim Group
Established in the 1930s as a trading business, Al-Futtaim Group today is one of the most diversified and progressive, privately held regional businesses headquartered in Dubai, United Arab Emirates.
Structured into five operating divisions; automotive, financial services, real estate, retail, and health; employing more than 33,000 employees across more than 20 countries in the Middle East, Asia, and Africa, we partner with over 200 of the world’s most admired and innovative brands. Al-Futtaim Group’s entrepreneurship and relentless customer focus enable the organisation to continue to grow and expand, responding to the changing needs of our customers within the societies in which we operate. By upholding our values of respect, excellence, collaboration, and integrity, Al-Futtaim Group continues to enrich the lives and aspirations of our customers every day.
