(Economic Observation) Global car companies compete for carbon neutrality. New energy vehicles usher in opportunities?

  China News Service, Beijing, August 31st, title: Global car companies compete for carbon neutral new energy vehicles, usher in opportunities?

  Author Liu Wenwen

  As countries around the world have formulated carbon neutrality goals, new energy vehicle companies around the world are promoting carbon emission reductions.

What is the current status of global new energy vehicle carbon emission reduction?

What role does new energy vehicles play in the process of car companies moving towards carbon neutrality?

How should this "decarbonization war" be fought?

Global car companies are racing towards carbon neutrality

  At present, mainstream foreign automakers have begun to clarify their emission reduction targets at the time of carbon peak and carbon neutrality, and some have even formulated clear process goals and specific measures and paths.

  Daimler stated that by 2030, the sales of Mercedes-Benz brand electric passenger cars will account for more than 50%; by 2039, Mercedes-Benz will stop selling traditional internal combustion engine passenger cars. All of its passenger vehicles will be carbon neutral.

  Volvo proposed the "2040 Environmental Plan" in 2019, striving to become a global climate zero-load benchmark enterprise by 2040.

  China Great Wall Motors recently announced its strategic goal for the next five years, stating that it will achieve annual sales of 4 million vehicles in 2025, with new energy vehicles accounting for 80%, and will achieve carbon neutrality in 2045; BYD has started the construction of the first Chinese car brand The headquarters of the Zero Carbon Park.

New energy vehicles lead the tide of "decarbonization"

  In an interview with reporters, Xie Tian, ​​managing director of the Boston Consulting Group (BCG), global partner, and core leader of the automotive and mobility business in China, said that for mainstream car companies, it is necessary to achieve carbon peaks and carbon neutrality. At the critical time point to reach the emission reduction target, it is necessary to increase investment in the production of more new energy vehicles.

  It is understood that the carbon emissions within the scope of production and operation of a company can be divided into three ranges. Scope 1 refers to the direct emissions of the company, such as fuel combustion, company-owned vehicles and other fugitive emissions; Scope 2 refers to the source of purchased electricity Scope 3 refers to the use process of purchased goods and services, upstream and downstream industrial chains, and sold products.

  Li Ke, partner of BCG and member of the core leadership team in the automotive and mobility business in China, further explained that for car companies, the carbon emissions of Scope 1 and Scope 2 only account for 5% of the overall emissions, while 95% of carbon emissions Occurs in the scope of three links, of which the upstream raw material supply link accounts for 30%, and the downstream product sales and use links account for 65%.

If the downstream emissions are reduced by half, it is equivalent to reducing the overall emissions by 30%-35%.

  Li Ke believes that for new energy vehicles, in the production process, the energy form can be changed and the production process can be optimized to promote emission reduction, but the carbon emissions in the production process only account for 5%, which has a relatively limited impact on the overall emissions; on the contrary, the upstream and downstream carbon emissions Emissions have a great impact on overall emissions, especially downstream.

Obviously, producing more new energy vehicles is an important measure for car companies to achieve carbon emission reduction targets.

  The latest data from the China Automobile Association shows that in July 2021, the production and sales of new energy vehicles reached 284,000 and 271,000 respectively, an increase of 1.7 times and 1.6 times year-on-year.

  According to the "New Energy Vehicle Industry Development Plan (2021-2035)", by 2025, the sales of new energy vehicles will account for 20% of the total sales. By 2035, pure electric vehicles will become the mainstream model for new car sales.

How to fight the "decarbonization war" of new energy vehicles?

  Li Ke pointed out that if car companies want to decarbonize, they must first complete a carbon inventory, and then formulate corresponding target measures to solve the corresponding problems on this basis.

At present, the progress of Chinese car companies' carbon emissions in Scope 1 and 2 is slightly lagging behind.

China's auto industry has not been included in the carbon trading market for the time being, and auto companies' carbon inspections, energy consumption statistics, and quota allocation have not yet been completed. It is not yet clear how to achieve carbon emissions reduction by changing energy forms and production processes.

Although car companies are currently considering the purchase of green power and green certificates to reduce emissions, the green power trading mechanism in many provinces in China is not yet complete.

  In addition, leading foreign car companies in the field of new energy vehicles have begun to clearly require upstream battery suppliers to use green electricity to produce batteries, forcing suppliers to save energy and reduce emissions.

  In scope three, China's performance is better than that of foreign countries.

Thanks to China's vigorous advancement of electrification, automakers are forced to produce more new energy vehicles and increase penetration rates, making the effectiveness of Chinese automakers' emissions reductions in the three downstream links of the scope more prominent.

  Xie Tian said that moving towards carbon neutrality is a major event shared by the entire society and cannot be accomplished by a single company or department alone.

For car companies, there are multiple links from production to sales. This is a fairly long industrial chain that requires overall planning and multi-party cooperation.