Valeo – Aiming for Carbon Neutrality by 2050
In 2021, global automotive supplier Valeo committed to reaching carbon neutrality by 2050. With $21 billion in sales and 109,900 employees in 29 countries, Valeo has a presence in Troy, Auburn Hills, and Highland Park. SBN Detroit interviewed Valeo Group CAP50 Director Zobeida Gutierrez about the company’s sustainability efforts globally and its impact on Southeast Michigan. Q: Tell us about the CAP50 project. A: Championed by CEO and President Christophe Périllat, Valeo’s global decarbonization plan primarily focuses on 156 production plants. However, our actions extend to our design centers and Valeo Service activities around the world. I have worked for Valeo for thirty years in a variety of positions, including roles in quality in operations, supplier quality, project management, and special projects. I am now the global lead for Valeo’s CAP50 decarbonization plan, and I support other sustainability and circular economy initiatives within North America. Q: What are the specifics of the plan? A: This is our action plan to contribute to carbon neutrality by 2050 across the entire Valeo value chain. Valeo has set 2030 near-term CO2 reduction targets validated by SBTi (Science Based Target initiative) Scope 1 and 2 CO2 emission absolute value reduction of 75% and Scope 3 upstream and downstream reduction of 15% from our 2019 baseline. This goal translates to removing 8.1 million metric tons of greenhouse gas emissions by 2030. Since 2019, we have removed 4.4 million metric tons as of the end of 2022, confirming the effectiveness of our CAP 50 plan. The second reduction target integrates benefits realized from electrification within our product portfolio, accounting for a 45% CO2 emission reduction due to avoided emissions at third parties as compared to the 2019 CO2 emissions footprint baseline. Q: What actions are you taking to achieve this? A: Our framework includes all three scopes as well as greenhouse gas emissions. Scope 1 targets direct emissions coming from our operations. We are currently investing to get our top 100 CO2 emitting sites Energy Management ISO 50001 certified to ensure they are focusing on energy efficiency to drive a 30% reduction in energy consumption by 2030. We are also switching to LED lights, eliminating fuel, oil, and natural gas use, installing solar panels at our sites, and introducing energy-efficient equipment. Scope 2 focuses on indirect greenhouse gas emissions incurred by our energy suppliers. Our low-carbon electricity procurement supports the increase of renewable energy capacity projects. Our internal target is to secure 50% of energy coming from renewable sources by 2025 and 80% by 2030. Valeo has committed to investing $436 million to support Scope 1 and Scope 2 actions. Scope 3 involves indirect greenhouse gas emissions within our supply chain, upstream and downstream. Upstream efforts target indirect emissions incurred by our suppliers, and downstream efforts target indirect emissions incurred by the use and end-of-life of our products. For Scope 3 upstream, we launched a sustainability assessment questionnaire to evaluate our supply chain sustainability maturity level. We also align our suppliers’ greenhouse gas emissions targets with ours – a reduction of 75% for Scope 1 and Scope 2 and 15% for Scope 3 Upstream emissions vs. their baseline year. Our suppliers are also required to cascade these targets throughout their entire supply chain. Our transportation levers within Scope 3 include greener fuels, optimization of filling rates for trucks, multimodal scenarios such as replacing airfreight with train or truck, and the use of returnable and greener packaging. For Scope 3 downstream, Valeo is accelerating its technological roadmap and cementing its global leadership in the electrification market. Currently, 60% of our portfolio supports EVs. We are researching and validating greener materials and designing more energy-efficient, lighter, and greener products. No reduction in greenhouse gas emissions is too small. Every Ton of CO2 reduced counts. Even if it’s simply balancing HVAC systems in our buildings to save energy, simple things can add up to several tons of CO2 emissions reductions. Q: How is your team structured to support the goals and initiatives? A: It starts at the top. Our board of directors has set targets and reviewed achievements related to sustainability and climate change since 2016. In addition, since 2020, a director has been responsible for monitoring corporate social responsibility issues. The Chief Sustainability Officer position within Valeo aligns with the Corporate Vice President of Sustainable Development and External Affairs, who works in partnership with the Chief Technology Officer and Vice President of Strategy. Sustainability topics are therefore under the direct oversight and management of the CEO. Our human resources, health, safety, and environmental, ethics and compliance, research and development, and operations departments (purchasing, quality, projects, industrial) all contribute to Valeo’s sustainable development policy, and each business group assigns CAP 50 champions. Q: What are your biggest challenges? A: Our biggest concern – which is not unique to Valeo – is the lack of renewable energy capacity. The world needs to triple global renewable capacity from 2022 levels by 2030, which must reach 11,000 gigawatts in line with the International Energy Agency’s net zero emissions by 2050 scenario. Also, there is a need for stronger domestic policies and international support, most notably in clean energy investment in emerging and developing economies. Q: What are the biggest opportunities? A: Electrification acceleration. The introduction of electric vehicles is an opportunity, not only for cars but also for micromobility. Another opportunity is preserving our resources by creating a circular economy. Valeo has created the 4R Circle, which is our plan for Robust Design, Remanufacturing, Repair, and Recycling aimed at reducing the use of raw materials and preserving the planet’s resources by giving our products extended life and recyclability options. Q: How is the work you are doing impacting Southeast Michigan? A: In June 2022, we signed a contract with energy supplier DTE Energy to contribute 100% of renewable energy usage at our Michigan locations (Troy, Auburn Hills, and Highland Park) starting in April 2024. This contract is for 20 years, and it demonstrates Valeo’s commitment to supporting renewable energy projects
