Ford: Transformation must also be ethically sustainable

The US automobile manufacturer Ford has, for the first time, supplemented its integrated sustainability and financial report 2022 with a human rights report. This is intended to highlight the risks of transformation with regard to ethical procurement issues, in the context of ambitious electrification plans. The production of fully electric vehicles is to be scaled up to more than two million units annually by 2026. From 2022 to 2026, the company plans to invest more than $50 billion worldwide in the development of electric vehicles and propulsion batteries.

By the end of the decade, half of the annual sales volume is to be generated from electric vehicles. Moreover, the company aims to achieve climate neutrality by 2050 at the latest, with self-imposed interim targets to be met by 2035. In addition to voluntary climate-related information, the new report also includes its progress in reducing emissions per vehicle by 50% compared to 2019, as well as reducing site emissions by 76% compared to 2017. Last year alone, the company claims to have reduced its manufacturing-related emissions footprint by 35% compared to 2017.

"The increasing shift to electric vehicles is crucial for Ford to achieve its sustainability goals. However, such a transition brings some challenges - including raw material procurement, battery recycling, and fundamental ethical questions," the manufacturer states. 

For this reason, the integrated sustainability and financial report 2022 includes an independent human rights report for the first time, a first for Ford and, according to their own information, for the entire US automobile industry. Besides climate and financial disclosures, the report also focuses on the consideration of climate risks.

"The truest indicator of our success is whether we make the world a better place for the next generation," explained Bill Ford, Chairman of the Ford Motor Company.

In the human rights report, the company examines how materials are sourced, where products are manufactured, and the standards by which labor practices are measured, Ford further outlines. The company promises to continue expanding its manufacturing locations, create new jobs, and maintain a sustainable and ethical supply chain.

"This year's report is significant as it underscores Ford's long-standing commitment to transparency and comprehensive disclosure," says Cynthia Williams, Global Director of Sustainability, Homologation, and Compliance at Ford.

This gives stakeholders a clear picture that people are put first and that human rights are given high priority in the transition to electric vehicle production, building on the highest possible climate and environmental protection, Williams continues. The slogan is: "What is good for the planet is good for our customers and our business."

Ford+: A Grand Plan

With the Ford+ plan, the aim is to leverage economies of scale in electric vehicle production and promote the use of connectivity and disruptive technologies. Additionally, the company was one of the first US automakers to join the international community in limiting global warming under the Paris Agreement.

Examples of specific sustainability progress by the manufacturer include:

• Joining RouteZero, a global coalition to curb global warming. This group of international stakeholders aims to make all new cars and vans sold worldwide emissions-free by 2040 and in numerous leading markets by 2035.
• Introducing a sustainable financing framework to steer investments towards social and environmental projects, paving the way for Ford's first green bond, which is expected to raise $2.5 billion over a 10-year issuance period to generate additional funds for the growing portfolio of electric vehicles.
• The company and SK Innovation announced a joint investment of $11.4 billion in BlueOval City and three BlueOval SK joint venture battery plants in Kentucky and Tennessee. These sites will create nearly 11,000 new jobs and contribute to sustainable production. Additionally, they plan to invest more than $525 million in the next five years in vocational development and training of automotive technicians for servicing electric and connected vehicles.
• Partnering with Redwood Materials, a leading battery materials company, to make electric vehicles specifically for Americans more sustainable and affordable. The focus is on identifying supply chains to create recycling options for scrap and old batteries and to increase the recycling of lithium-ion batteries.
• Planning to open a global battery center in southeast Michigan, Ford Ion Park, for the development and manufacture of battery cells and assemblies, focusing on lithium-ion technology while also exploring solid-state battery technologies.
• Joining the US Department of Energy's "Better Climate Challenge" to reduce greenhouse gas emissions from its facilities by at least half by 2030, consistent with the pledge to power its operations with 100% sustainable electricity by 2035.
• Annual water consumption was reduced by more than 78% compared to the year 2000, and the global CO2 footprint in manufacturing was reduced by more than 35% compared to 2017.