BUSINESS

Ford Moves to Beef Up Supply Line Stability

November 21, 2022

Ford has an interesting problem these days: it has more customers for its award-winning EVs than it has vehicles to sell them!

Ford, like many other automakers, is facing supply line issues in two ways. First, they’re struggling to meet the pent-up demand for their hot new electric and hybrid vehicles. Second, they’re struggling to find suppliers who can meet that demand and do so in a way that’s environmentally responsible and sustainable over the longer term.

To that end, the company is announcing a strategic partnership with Manufacture 2030, an organization that helps make it easy for suppliers to measure, manage and reduce their carbon emissions while still meeting key deliverables. The companies released the following press release last week:

Ford is among the first American automakers to join Manufacture 2030, and the first American automaker to include its global supply chain on the platform
M2030 is designed to help suppliers measure, manage and reduce carbon emissions as Ford strives to reach carbon neutrality globally across its vehicles, operations and supply chain
The move builds on guidance Ford issued to suppliers requiring they establish science-based greenhouse gas reduction targets, action plans, and transparent reporting mechanisms to minimize their impact on climate change

DEARBORN, Mich. — Ford Motor Company and Manufacture 2030 announced today a strategic partnership to help Ford’s suppliers meet their carbon reduction targets toward Ford’s goal of reaching carbon neutrality no later than 2050 globally, and by 2035 in Europe.

Ford is among the first American automakers to join Manufacture 2030, and the first to include its global supply chain on the platform. M2030 is designed to help suppliers measure, manage and reduce carbon emissions. Ford manufactures more vehicles in the U.S. and employs more hourly workers in America than any other automaker and was one of the first American automakers to align with the international community to limit the impacts of global warming as part of the Paris Climate Agreement.

“Achieving carbon neutrality for Ford is an important corporate goal and integral to our purpose to help build a better world,” said Jonathan Jennings, Ford Global Vice President, Supply Chain. “It is becoming a strong demand from our customers, shareholders and investors, and the supply chain is essential in achieving this goal. Hitting our targets will require we cut emissions across our entire value chain, particularly from purchased energy, goods and services. M2030 is a key program for Ford to help us all in not only reporting emissions but in forming realistic action plans and glidepaths to achieving our goals.”

In the first phase of the partnership with M2030, Ford is offering the voluntary platform to its more than 5,000 Tier 1 global supplier sites covering more than 66 countries, including suppliers who have yet to establish science-based carbon reduction targets. M2030’s platform can help suppliers identify which actions to take to measure, manage and reduce carbon emissions and reduce costs as they build their carbon neutrality plans.

“This is a powerful example of how Ford’s scale and proven industrial expertise can help accelerate the shift to EVs and support a diverse supply chain that is good for people and the planet, and good for business,” said Cynthia Williams, Global Director Sustainability, Homologation and Compliance at Ford. “By working together and leveraging our collective expertise, we believe this platform will help our suppliers deliver significant carbon reductions and greater positive impact.”

Building on strong demand for its new electric vehicles, Ford recently announced a series of initiatives for sourcing battery capacity and raw materials that light a clear path to reach its targeted annual run rate of 600,000 EVs by late 2023 and more than 2 million by the end of 2026. As Ford creates a new EV supply chain that upholds its commitments to sustainability and human rights, the company continues to plan for more than half its global production to be EVs by 2030.

The initiative will also support the company’s commitment to the First Movers Coalition, a global initiative to harness purchasing power and supply chains to create early markets for innovative clean energy technologies. As part of the coalition, Ford committed to purchase at least 10% near-zero carbon steel and aluminum by 2030.

Ford has outlined specific conduct guidelines for its suppliers since 2003, and in 2021, established a formal supplier code of conduct that applies clear expectations related to human rights, the environment, responsible material sourcing and lawful business practices for every member of the company’s supplier community. The code of conduct requires Ford suppliers to establish science-based greenhouse reduction targets, action plans, and transparent reporting mechanisms aligned with the Paris Climate Agreement to minimize their impact on climate change .