Green transformation in the automotive industry: “there is a lot of pressure at the back of the supply chain”

STAUFEN MAGAZINE 2021 | No. 4 | Green Transformation Study | Input
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Prof. Dr.-Ing. Gisela Lanza
Institutsleiterin Produktionssysteme

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PROF. DR.-ING. GISELA LANZA
Institute Director Production Systems Karlsruhe Institute of Technology (KIT) wbk Institute for Production Technology

DR. THILO GRESHAKE
Partner Automotive STAUFEN.AG

In the interview with Dr. Thilo Greshake, industry manager automotive at Staufen AG, Prof. Dr.-Ing. Gisela Lanza explains where the automotive industy is with regard to climate protection systems at the Karlsruhe Institute of Technology (KIT) focuses among other things on more climate-friendly production.

Electric car lithium battery pack and power connections

“Our annual study ‘Green Transformation in the Automotive Industry’ shows very clearly how seriously the industry is approaching this topic right now. Precisely for the suppliers, this transformation requires great effort, now as before.”

DR. THILO GRESHAKE
STAUFEN.AG

Prof. Lanza, our study “Green Transformation in the Automotive Industry 2021” shows that the industry is making progress along the path to the green transformation. Is this also your impression?

Yes, however the focus is only on linear resources and energy production, namely on CO2-neutral production in the production chain from OEM to Tier X and documenting this cleanly

How well is this working?

The suppliers are surprised how quickly this topic is being advanced
and how quickly they are supposed to compensate for the CO2 they
produce. Of course, many of them are not prepared for this, among
other things because there were previously no clear standards, so
that apples and oranges are being compared to one another. And it
has to be clearly regulated who is to provide what data. However, I am
optimistic that this will work well in the automotive industry.
For in the industry there is a clear power pyramid: if the OEMs want
something, they will get it. At the moment there is a lot of pressure,
also at the back of the supply chain, since there is a great need for
catch-up there.

But isn’t there also a lot of inertia and skepticism,
precisely with regard to CO2 neutrality?

Yes, because some companies think there is a lack of logic when it
comes to this topic. You can’t discount the fact that some suppliers
achieve EBIT of just 2 to 3%. They don’t have any time to worry
about this topic, to ensure transparency with regard to energy
efficiency and savings; their primary concern is how to survive. We
have to ask ourselves the question: what happens to companies
whose ecological balance sheets don’t look good? Do these companies have the financial power to play along? How can you help them
if necessary?

And this applies to more than just small suppliers at the back of the chain; current climate activities present an enormous challenge even to large companies. And they’re just the start of things, aren’t they?

In research, we’re thinking further ahead. I am focusing especially on the topic of the circular economy. The topic of circularity is something companies have not yet tackled. The concern here is raw materials such as lithium. It is taken from the earth and there is a finite supply. But do we really want to mine all the lithium that is indispensable for battery manufacturing from scratch? At least in the battery and fuel cell sectors, companies are starting to consider circular models.

And beyond that, not a lot is happening?

No, in comparison to the 1980s, we are sooner moving away from the circular economy. Once upon a time, electronic components could be repaired. Now, they end up in the trash, just as used devices do. And we’re not making any progress with the topic of remanufacturing either. Here, the old products are returned to the factory, repaired, and then they have a second life. They are about 30% cheaper. This whole scenario plays out mostly in low-wage countries; nevertheless, remanufacturing is only rarely worthwhile. The products cannot compete with gray or inexpensive products from Asia.

How can a circular economy even work?

There is no contradiction between economy and ecology. If sustainable, circular business models arise for companies, they will act. That’s
why legislation should create reliable framework conditions for a
circular economy, and this has to be done on the European level.

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