A CDP report published today analyzed 16 of the world’s largest publicly-listed automotive companies that responded to an extensive questionnaire last year. The report identified best and lowest performing automakers as well as major opportunities emerging while the industry enters a low-carbon transition.
The report, called “Driving Disruption,” assessed companies across key areas aligned with recommendations from the G20 Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD): transition risks, transition opportunities, and climate governance and strategy.
For risks, CDP assessed fleet emissions, manufacturing emissions, and energy intensity performance. In the opportunities section, the report looked at progress with advanced vehicles, autonomous driving vehicles, mobility as a service, R&D activity, and renewable energy use. CDP also examined governance frameworks that included emissions reduction targets, supplier engagement, water use, and the alignment of the companies’ governance and remuneration structures with low-carbon objectives.
CDP says the best performing companies on climate-related metrics are BMW, Daimler (Mercedes-Benz), and Toyota. Ranking at the bottom are Subaru, Suzuki, and FCA Group, which includes Chrysler, Dodge, Jeep, Fiat, and RAM. In addition, CDP ranked General Motors first for the transition opportunities area, but last for managing transition risks.
The report’s authors found that Ford had poor fleet emissions performance across all regions although the automaker ranked second in the CDP’s advanced vehicle targets and mobility-as-a-service section. The report also highlighted GM’s efforts to work toward an “all-electric future.”
Key opportunities for OEMs from the report include capturing the advanced vehicle market such as battery electric vehicles, fuel-cell vehicles, and plug-in hybrid vehicles. “Li-ion battery prices continue to fall and we expect to see battery electric vehicle price parity with internal combustion engine vehicles from around 2022,” the report says. “In a scenario where 30% of new car sales are zero emission or plug-in hybrid by 2030, the potential EV market could add up to $1 trillion.”
Another finding was that OEMs risk missing emissions targets. “For Europe, we estimate half our company sample is at risk of paying regulatory fines and some OEMs may require up to 20% of sales from electric vehicles in order to meet 2021 targets,” the report says. Overall, those costs could be high, with up to €940 million ($1.14 billion) at stake, CDP’s press release notes.
Altogether the 16 companies CDP analyzed represent more than three-quarters of the global passenger vehicle market. Kia, Great Wall, and Geely (Volvo) did not respond to CDP’s 2017 climate change questionnaire and weren’t included.
“The auto sector is facing two waves of technological disruption — the first from EVs and the second from autonomous, shared driving,” Luke Fletcher, a senior analyst at CDP and one of the report’s authors commented publicly about the findings. “A whole new ecosystem is emerging, integrating energy generation, storage, and transport.”
CDP’s League Table summary rankings:
- Tata Motors
- PSA Group
- General Motors
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