Wednesday, 17 May 2017

Environmental Leader/Jennifer Hermes: GM’s Move to Source Only Sustainable Tires Knocks Down Supply Chain Risk

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GM’s Move to Source Only Sustainable Tires Knocks Down Supply Chain Risk
May 17, 2017 by Jennifer Hermes

With the announcement that it plans to work within the industry to source only sustainable natural rubber in its tires, General Motors is helping to reduce its risk related to the sourcing and long-term availability of one of its key commodities, says GM’s senior VP of global purchasing and supply chain, Steve Kiefer. “The business case helped drive this change,” he told Environmental Leader. By working with its supply base to source sustainable tires in a strategic, collaborative way, “we can ensure volume meets growing global demand through improved yields,” he says. The initiative would also eventually ensure net-zero deforestation and the building of stronger communities.

GM is working directly with suppliers that support the goal of using only sustainable natural rubber tires, including Bridgestone, Continental, Goodyear and Michelin. Together, the groups will work on solving the challenges of transparency and traceability in a complex value chain, Keifer says. GM will also soon be kicking off a series of multi-stakeholder dialogues and exchanges in 2017 to discuss the “what” and the “how” of the commitment, and throughout the year the company will work to raise awareness and encourage participation from other automakers and suppliers to join in the effort.

Force Suppliers to Meet Sustainable Demands? Not a Viable Option

Keifer told Environmental Leader that the company could implement sustainable requirements – such as no deforestation or human rights violations – immediately, and force its suppliers to meet them, but it wouldn’t have as much long-term environmental or economic impact as working together within the industry as a whole.

As tire manufacturers develop sustainable natural rubber policies, automaker demand will help fuel results, the company believes. GM will be working with tire suppliers, governments, rubber industry associations and environmental NGOs to get on the same page in terms of sustainable tire requirements and reducing supply chain complexity.

Long-term Approach to Business

General Motors looks on this initiative as an example of its long-term approach to business. In addition to helping mitigate future risk related to the sourcing of a key material, Keifer says the commitment will drive other incremental benefits in business down the line. “The whole industry will need to come together to help solve this challenge. Increasing the yield will drive cost efficiencies, which is why encouraging other automakers and tire buyers to join in the effort is so important,” he says. “Plus, to be sustainable financially, a component must meet or exceed quality standards and be cost-competitive.”

The commitment also helps reduce carbon impacts on the communities where rubber is produced and ensures people are safe when doing related jobs in those regions, GM says.

Water Is Important, Too…

General Motors is also pushing for sustainability within its water-intensive automotive processes, Todd Williams, GM’s senior project engineer for water and wastewater treatment, told Environmental Leader. In the automotive industry, the biggest water user is paint departments. Preparing, washing, coating, providing the right heating, ventilation, humidity levels for paint drives a significant amount of water usage, Williams said, adding, “I spend a lot of time with the paint process engineers. We’ve developed counter-flowing rinses and built that into the process.”

Todd Williams will be speaking at the Environmental Leader Conference in Denver June 5-7, 2017. His track, New Strategies for Stormwater Management, starts at 3 pm on June 6.

Categories EL Conference, Environmental Management, Feature, Manufacturing, Supply Chain, WaterTags General Motors, GM, risk, supply chain, sustainable rubber
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