BorgWarner Partners with Manufacture 2030 to Reduce Supply Chain Emissions

Rhea-AI Summary

BorgWarner partners with Manufacture 2030 to reduce supply chain carbon footprint and achieve Scope 3 emissions reduction goals. The partnership aims to track energy usage of suppliers to promote emissions reduction efforts and sustainability. BorgWarner leverages M2030's software for data collection, tracking, and best practice sharing for emissions reduction across its supply base.

Insights

Sustainability Analyst

The strategic partnership between BorgWarner and Manufacture 2030 represents a significant step towards sustainability within the automotive industry. By integrating M2030's decarbonization software, BorgWarner is addressing the often-overlooked Scope 3 emissions, which encompass indirect emissions in the value chain. This is a crucial area as it typically represents the majority of an organization's greenhouse gas footprint.

From a sustainability perspective, BorgWarner's initiative could create a ripple effect, encouraging suppliers to adopt greener practices. This not only aligns with increasing regulatory pressures but also with consumer demand for more environmentally responsible products. By providing tools to track and manage emissions, BorgWarner is fostering transparency and accountability, which can lead to more informed decision-making and potentially lower emissions over time.

However, the success of such a program depends on the willingness of suppliers to participate and invest in necessary changes. The long-term impact on BorgWarner's carbon footprint and the broader industry will be contingent on the effectiveness of the software and the collective action taken by the supply chain.

Supply Chain Management Expert

The partnership between BorgWarner and M2030 could revolutionize supply chain management by integrating environmental performance into core business strategies. The use of an interactive dashboard to track emissions and energy usage offers a level of granularity that can pinpoint inefficiencies and drive improvements in manufacturing processes.

Supply chain optimization often focuses on cost, quality and delivery. Incorporating emissions tracking introduces a new dimension of competition among suppliers, potentially leading to a market advantage for those who excel in sustainability. This proactive approach to supply chain management could set new industry standards and influence supplier selection criteria.

However, the implementation of such systems can be complex and may require significant changes in operations and reporting. Suppliers may face challenges with the adoption of the software, including costs and the need for training. The effectiveness of this initiative will depend on the balance between the environmental benefits and the operational impact on suppliers.

Investment Analyst

BorgWarner's commitment to reducing Scope 3 emissions could be interpreted as a strategic investment in the company's future competitiveness and market positioning. Investors increasingly factor in environmental, social and governance (ESG) criteria into their investment decisions and BorgWarner's actions could enhance its ESG profile.

Reducing emissions is not only environmentally beneficial but can also lead to cost savings through improved energy efficiency. If BorgWarner's strategy leads to a greener supply chain, it may benefit from cost reductions, as well as a stronger brand reputation. On the other hand, investors should monitor the short-term financial implications, as initial investments in decarbonization efforts could impact profit margins.

It's also important to consider the validation by the Science Based Targets initiative (SBTi), which lends credibility to BorgWarner's environmental targets. This external validation could provide additional assurance to stakeholders that the company is on a solid path towards sustainability, potentially influencing investor confidence positively.

• Partnership will support BorgWarner in reaching Scope 3 emissions reduction goal
• Suppliers will be encouraged to use tool to track energy usage

AUBURN HILLS, Mich., March 6, 2024 /PRNewswire/ -- BorgWarner has entered into a strategic partnership with Manufacture 2030, a decarbonization software provider, to effectively measure and reduce its supply chain carbon footprint and support its goal of reducing absolute Scope 3 greenhouse gas (GHG) emissions 25% by 2030.

Through the agreement, BorgWarner will leverage M2030's extensive expertise in CO2 reduction and unique software to encourage its direct material suppliers to increase their emissions reduction efforts. M2030 will work directly with BorgWarner's supply base to gather energy usage data related to the manufacturing of products such as electricity, natural gas and more. That data will then be fed into an interactive dashboard where emissions and energy reduction efforts can be tracked. The tool also provides best practice sharing opportunities for pursuing emissions reduction. By utilizing the tool, BorgWarner will promote collaboration, accountability and engagement across its supply base on emissions reduction.

"BorgWarner is greatly looking forward to working together with M2030 and utilizing the decarbonization resources the company offers. Reducing our carbon footprint in our supply base is a vital step in creating a cleaner, more sustainable future for all," said Volker Weng, Vice President of BorgWarner Inc. and President and General Manager, BorgWarner Drivetrain and Battery Systems, Environmental Sustainability Lead. "Offering this software to our suppliers enables them to manage, track and reduce their emissions, which in turn enables us to reduce our Scope 3 emissions footprint."

Most recently, the SBTi validated BorgWarner's targets to reduce absolute Scope 1 and 2 GHG emissions 85%, and absolute Scope 3 GHG emissions 25% by 2030, both from a 2021 base year. Another key lever in the company's pursuit of Scope 3 emissions reduction is the company's Charging Forward accelerated electrification strategy, which aims to advance its position as a technology leader in eProducts and maximize its foundational portfolio.

About BorgWarner
For more than 130 years, BorgWarner has been a transformative global product leader bringing successful mobility innovation to market. Today, we're accelerating the world's transition to eMobility – to help build a cleaner, healthier, safer future for all. 

About Manufacture 2030
Manufacture 2030 provides global brands, corporations and their small and medium-sized suppliers with the data, tools and support they need to be certain they can hit their GHG emissions reduction targets. Its unique AI-powered software platform and support services help measure, manage, and reduce emissions across global supply chains. For more information, visit https://manufacture2030.com.

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You should not place undue reliance on these forward-looking statements, which speak only as of the date of this release. Forward-looking statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond our control, that could cause actual results to differ materially from those expressed, projected or implied in or by the forward-looking statements. These risks and uncertainties, among others, include: supply disruptions impacting us or our customers, such as the current shortage of semiconductor chips that has impacted original equipment manufacturer ("OEM") customers and their suppliers, including us; commodity availability and pricing, and an inability to achieve expected levels of recoverability in commercial negotiations with customers concerning these costs; competitive challenges from existing and new competitors including OEM customers; the challenges associated with rapidly changing technologies, particularly as they relate to electric vehicles, and our ability to innovate in response; the difficulty in forecasting demand for electric vehicles and our electric vehicles revenue growth; disruptions in the global economy caused by wars, including the wars in Ukraine and the Middle East; the ability to identify targets and consummate acquisitions on acceptable terms; failure to realize the expected benefits of acquisitions on a timely basis; the possibility that our recently-completed tax-free spin-off of our former Fuel Systems and Aftermarket segments into a separate publicly traded company will not achieve its intended benefits for us; the failure to promptly and effectively integrate acquired businesses; the potential for unknown or inestimable liabilities relating to the acquired businesses; our dependence on automotive and truck production which is highly cyclical and subject to disruptions; our reliance on major OEM customers; the extent, duration, and impact of the recent and any future strikes involving some of our OEM customers and any actions such OEM customers take in response; fluctuations in interest rates and foreign currency exchange rates; our dependence on information systems; the uncertainty of the global economic environment; the outcome of existing or any future legal proceedings, including litigation with respect to various claims, or governmental investigations, including related litigation; future changes in laws and regulations, including, by way of example, taxes and tariffs, in the countries in which we operate; impacts from any potential future acquisition or disposition transactions; and the other risks noted in reports that we file with the Securities and Exchange Commission, including Item 1A, "Risk Factors" in our most recently filed Form 10-K and/or Quarterly Report on Form 10-Q. We do not undertake any obligation to update or announce publicly any updates to or revisions to any of the forward-looking statements in this release to reflect any change in our expectations or any change in events, conditions, circumstances, or assumptions underlying the statements.

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SOURCE BorgWarner

FAQ

What is BorgWarner's partnership goal with Manufacture 2030?

BorgWarner aims to reduce its supply chain carbon footprint and achieve a 25% reduction in absolute Scope 3 greenhouse gas emissions by 2030 through the partnership with Manufacture 2030.

How will BorgWarner track energy usage of its suppliers?

BorgWarner will leverage Manufacture 2030's software to gather energy usage data related to the manufacturing of products such as electricity and natural gas from its supply base.

What does the interactive dashboard provided by M2030 offer?

The interactive dashboard allows tracking of emissions and energy reduction efforts, as well as provides best practice sharing opportunities for pursuing emissions reduction.

What are BorgWarner's validated targets for GHG emissions reduction?

BorgWarner's targets validated by SBTi include reducing absolute Scope 1 and 2 GHG emissions by 85% and absolute Scope 3 GHG emissions by 25% by 2030 from a 2021 base year.

How does BorgWarner plan to further reduce Scope 3 emissions?

BorgWarner's Charging Forward accelerated electrification strategy aims to advance its position as a technology leader in eProducts and maximize its foundational portfolio to reduce Scope 3 emissions.