Sustainability, circularity, and independence will be achieved by the automotive industry
03/10/2022
There has been the biggest revolution in the European automotive industry since the post-war period. In fact, in addition to ceasing production of internal combustion vehicles by 2035, to make way for electric motors and lithium-ion batteries, car manufacturers are working to bring emissions from their plants to zero. Apart from these two profound changes, semiconductor supplies were scarce and various components were difficult to obtain due to geopolitical factors. A crucial point is the production of batteries for electric cars (currently primarily located in Asia), which is expected to significantly increase in Europe over the next few years. A combination of these factors is radically transforming manufacturers' production, making it increasingly sustainable, circular, and as independent as possible.
Local suppliers
Prior to the pandemic, it was common to work with warehouses that were as little full as possible, to focus on just-in-time delivery, and to rely on suppliers based on the other side of the world. As a result, transportation costs were low, container ships were readily available, and China appeared much closer than it really was. Since then, everything has changed, including the semiconductor crisis, which has reshaped the rules of the game for more than two years, radically altering the automotive industry. Furthermore, it is impossible to achieve truly sustainable and circular production if, for example, a supplier holds one in check or if the production process has to be halted for weeks at a time due to a single component or the 'sky-high' price of methane and electricity.
The importance of the Gigafactory
How can this long list of challenges be addressed? To meet future challenges, the major automotive groups have discovered that sharing is the best course of action, namely developing platforms capable of creating electric models with significantly different characteristics, while simultaneously investing billions in the construction of Gigafactories. Furthermore, major investments have already been made to ensure the environmental neutrality of production facilities and to ensure self-generation of energy. For example, a leading German premium brand is planning to power all its facilities worldwide 70% from renewable energy sources by 2030, 15% of which will come from plants built on site by the brand. It is also the company's goal to reduce water consumption by 35%, in addition to achieving carbon neutrality in the entire logistics and transportation of components as well as cars, all by 2030. By 2023, a photovoltaic park capable of producing 11 MWp will be operating in Germany, thereby increasing its energy independence. Taking into account the transition to all-electric mobility by 2035 as requested and mandated by the European Community, one of the main challenges will be to produce batteries directly in the Old Continent.
Local suppliers
Prior to the pandemic, it was common to work with warehouses that were as little full as possible, to focus on just-in-time delivery, and to rely on suppliers based on the other side of the world. As a result, transportation costs were low, container ships were readily available, and China appeared much closer than it really was. Since then, everything has changed, including the semiconductor crisis, which has reshaped the rules of the game for more than two years, radically altering the automotive industry. Furthermore, it is impossible to achieve truly sustainable and circular production if, for example, a supplier holds one in check or if the production process has to be halted for weeks at a time due to a single component or the 'sky-high' price of methane and electricity.
The importance of the Gigafactory
How can this long list of challenges be addressed? To meet future challenges, the major automotive groups have discovered that sharing is the best course of action, namely developing platforms capable of creating electric models with significantly different characteristics, while simultaneously investing billions in the construction of Gigafactories. Furthermore, major investments have already been made to ensure the environmental neutrality of production facilities and to ensure self-generation of energy. For example, a leading German premium brand is planning to power all its facilities worldwide 70% from renewable energy sources by 2030, 15% of which will come from plants built on site by the brand. It is also the company's goal to reduce water consumption by 35%, in addition to achieving carbon neutrality in the entire logistics and transportation of components as well as cars, all by 2030. By 2023, a photovoltaic park capable of producing 11 MWp will be operating in Germany, thereby increasing its energy independence. Taking into account the transition to all-electric mobility by 2035 as requested and mandated by the European Community, one of the main challenges will be to produce batteries directly in the Old Continent.
