Can SBTi's Net Zero Plan Steer the EV Sector to 2050 Goals?

The automotive sector manufactures around 80 million vehicles a year and is responsible for more than 10% of the world’s annual carbon dioxide emissions according to McKinsey analysis.

The World Economic Forum says that the sector is redefining its priorities focusing on electric vehicle adoption and decarbonisation. 

The Science Based Targets initiative (SBTi) was launched in 2018 to help companies set greenhouse gas (GHG) emissions reduction in alignment with the Paris Agreement goals.

The company provides clear, science based criteria and a validated framework for businesses to reduce emissions to limit global warming. 

It has announced that it will be revising its net zero standards, alongside revising its criteria for the automotive sector.

Updated standard targets low-emission vehicle sales

Launched in 2018, the SBTi helps businesses set clear GHG emissions reduction targets that align with the Paris Agreement.

The agreement aims to limit global warming to well below 2 degrees Celsius, ideally closer to 1.5 degrees.

The SBTi offers a science based, validated framework for companies to act on their climate impact.

Now, it plans to refresh the net zero guidance for automakers and auto marts manufacturers,

The SBTi's draft includes:

• Releasing a new aggregated indicator combining Scope 1, 2 and 3 emissions from the perspective of new vehicle manufacturers
• New criteria requires companies to increase shares of low emission vehicle sales
• The introduction of regional emissions pathways designed to reflect economic and market differences
• More guidance on emissions calculations including data inputs such as default vehicle lifetime mileage, required to calculate use-phase emissions
• New criteria for auto part manufacturers to focus efforts on reducing emission from material sourcing and manufacturing.

The draft guidance replaces sections of the existing SBTi Land Transport Guidance and aligns with the SBTi Corporate Net Zero Standard.

“Reaching net zero is never going to be straightforward,” explains Tracy Wyman, Chief Impact Officer at the SBTi.

“But the guidance to get businesses there should be.”

What is the test draft?

To ensure the new standard is effective, the SBTi has opened a pilot testing phase for businesses in the automotive space.

This includes automakers and suppliers who are invited to try out the new criteria using real-world data.

The aim is to identify any implementation issues and validate the underlying assumptions.

Participating companies gain early access to the SBTi’s updated methodologies and tools.

In return, they provide feedback through a structured report and a basis of conclusion document.

Karl Downey, Head of Sector Standards at the SBTi, says: “Decarbonising the road transport sector is a crucial component of meeting our global net zero goals and the automotive sector has a substantial role to play as providers of new vehicles.

“The transition to net zero provides an abundance of opportunity for industry innovation and attractive offers for customers.”

Leading automakers commit to 2030–2035 targets

A number of major manufacturers have already set targets approved by the SBTi, many of which directly involve electric vehicle development and sales.

• Volkswagen plans to cut Scope 1 and 2 emissions by 50.4% by 2030 from a 2018 baseline. For Scope 3, it targets a 30% cut in emissions from light-duty vehicles per vehicle kilometre.

• Ford Motor Company commits to reduce Scope 1 and 2 emissions by 76% by 2035 from a 2017 base year, with a 50% reduction in Scope 3 emissions per vehicle kilometre.

• Mercedes-Benz AG targets a 50% reduction in Scope 1 and 2 emissions and a 42% cut in Scope 3 use-phase emissions by 2030.

• Toyota aims for a 68% cut in Scope 1 and 2 emissions by 2035 from a 2019 base year. It also targets a 33.3% reduction in Scope 3 emissions from passenger and light commercial vehicles and an 11.6% reduction from medium and heavy trucks by 2030.

• BMW Group commits to an 80% drop in Scope 1 and 2 emissions per vehicle produced by 2030 from a 2019 base year. It also targets a 50% cut in Scope 3 emissions from vehicle use and a 22% reduction in Scope 3 emissions from purchased goods, services and upstream distribution.

• Volvo Group plans to cut Scope 1 and 2 emissions by 60% by 2030 from a 2019 base year and to reduce Scope 3 emissions from vehicle use by 52% per kilometre.

Martin Lundstedt, CEO at Volvo Group, says: “We focus on our long-term vision of solutions that are 100% safe, 100% fossil free and 100% more productive. 

“We have climate targets that are in line with what climate-science deems necessary to keep global warming at a maximum of 1.5 degrees Celsius.”