## Volkswagen Group 2014 sustainability report shows progress on key environmental performance indicators; Strategy 2018 and leadership in e-mobility

##### 08 May 2014

The Volkswagen Group continues to make progress on the way to its goal of becoming the world’s most sustainable automaker, according to its 2014 sustainability report. The report provides information on the progress achieved in economic, environmental and social sustainability in 2013, and was drawn up in accordance with the G3 Guidelines of the Global Reporting Initiative (GRI). For the first time this involved the use of an IT system that in future will be expanded for Group-wide data acquisition and control activities, as well as for stakeholder management within the Group.

In the reporting year 2013, average energy consumption per vehicle produced was 2,205 kWh, down 0.4% from 2,213 kWh in 2012 and down 12.5% below the figure for the base year of 2010. Per vehicle CO2 emissions in 2013 were 422 kg, down 6% from 449 kg in 2013 and 19.5% lower than the 588 kg of the base year of 2010. The Group now takes one-third of its electric power from renewable sources.

The Volkswagen Group’s Sustainability Report has been published annually since 2011.

In 2013 the Group increased the number of cars and commercial vehicles delivered to customers to 9.73 million, which equates to 12.8% of the global passenger car market. The Group’s sales revenue totaled €197,007 million (US$274,175 million) in 2013, while profit after tax came to €9,145 million (US$12,727 million).

The largest sales market for the Volkswagen Group is the Asia-Pacific region, followed by Western Europe, North America, South America and Central and Eastern Europe. In 2013 alone, the Volkswagen Group opened seven new production plants around the world.

This report is a business card of our Group. It demonstrates our long term motives and motivation on the basis of clear figures and many examples—we are committed to responsible action with a long-term orientation. At Volkswagen, we do not want to achieve rapid success at the expense of others. We aim for solid, sustained growth that brings benefits to everyone: customers and investors, the environment and society, and last but not least our employees.

—Prof. Dr. Martin Winterkorn, Chairman of the Board of Management of Volkswagen Aktiengesellschaft

Winterkorn added that sustainability meant “quality of life and future orientation” for Volkswagen and was a “core element of the Group’s business” and not simply an “alibi”.

 Strategy 2018. The Group is currently driven by Strategy 2018— a set of action areas and measurable, defined strategic objectives for the year 2018 clustered into three primary areas: economy, people and environment.While some of the environmental goals are to meet regulatory targets, such as CO2 limits in the EU, the Group has also set itself the goal of becoming the market leader in e-mobility by 2018, and to reduce energy, water consumption, waste and emissions per product unit by 25% on a 2010 baseline, Group-wide, by 2018.By the end of 2014, a total of 14 models from various Group brands will feature an all-electric or hybrid powertrain. If there is sufficient demand, up to 40 new models could be fitted with alternative powertrains. Click to enlarge.

Volkswagen launched its “Think Blue” concept in 2005 as a scheme to highlight the most fuel-efficient car models (BlueMotion); since 2010 it has evolved into a holistic philosophy on environmental responsibility. Since late 2011, “Think Blue. Factory.” has broadened the concept to include production operations.

By 2018, “Think Blue. Factory.” aims to reduce the environmental impact per vehicle and component by 25% compared with 2010 levels, as measured by five key environmental factors: energy, water, waste, CO2 and solvent emissions, so that progress can be transparently measured. Volkswagen has also established a global standard to ensure uniform interpretation of the respective indicators.

27 of the 43 Volkswagen brand plants on four continents are currently taking part in the environmental program. By the end of September 2013, they had together identified resource-saving potential worth €114.3 million (US\$159 million). More than one-quarter of these measures are already up and running.

“Think Blue. Factory.” was devised in collaboration with the Volkswagen plants. The baseline was calculated for each plant, and binding targets were set for 2018. A catalog of 140 measures has been created to aid implementation. This is a concise compilation of best practices, pilot projects and technical innovations, and includes technical details, environmental impacts and contact details.

A company’s GHG emissions are classified into three scopes:

• Scope 1: Greenhouse gas emissions in CO2 equivalents from sources directly attributable to the company (also known as direct emissions): primary energy consumption by company-owned plant and equipment for manufacturing and energy generation, fuel consumption by company-owned vehicles, as well as other possible sources such as own landfills and wastewater treatment plants.

• Scope 2: Greenhouse gas emissions in CO2 equivalents created during the generation of purchased energy (electricity, heat or steam).

• Greenhouse gas emissions in CO2 equivalents from sources not directly belonging to but closely associated with the company, such as employee commuting, emissions generated during the use phase of products or upstream, for instance during the extraction of raw materials or transport-related activities.

The Volkswagen Group published its first Scope 3 Inventory for CO2 emissions as part of the 2012 Group Sustainability Report. In conjunction with the Scope 3 Standard published in 2011 by the World Business Council for Sustainable Development (WBCSD) and the World Resources Institute (WRI), the 2014 report analyzes CO2 emissions for twelve out of a total of 15 Scope 3 categories. The data reveals that more than 93% of the total Scope 3 volume is generated in the emissions categories “Purchased goods and services” and “Use phase”.

The increased consumption of electricity and heat and of fuel gases for manufacturing processes for light-duty vehicles is associated with the continuous increase in production over the reporting period. Consumption of space heat and industrial heat is subject to variation due to climatic and manufacturing conditions.

Despite increased production volumes and the inclusion of new production sites, with a consequent increase in energy consumption, Scope 1 (direct) CO2 emissions have been falling. Increased consumption of electrical energy, heat and fuel gases led to a rise in combined Scope 1 and Scope 2 (direct and indirect) CO2 emissions. However, the increase was restricted by the growing use of energy from renewable resources. Over the full reporting period, CO2 emissions per vehicle manufactured were reduced.

There was a downwards trend in NOx and SOx emissions over the 2010 to 2013 period, this decline also occurring in the specific values per vehicle. Specific NOx dropped 35% to 244 g/vehicle in 2013 from 373 g in 2010; SOx was down 66.7% to 17 g/vehicle in 2013 from 51 g in 2010.

Increased vehicle production is also associated with higher paint consumption, leading to an increase in VOC emissions in absolute terms. Modern coating processes did, however, assist in reducing specific emissions per vehicle produced.

The volume of metallic “waste” increased in absolute terms over the reporting period as a whole due to increased production across the Volkswagen Group and the introduction of new models. In specific terms, however, the volume of this kind of waste per vehicle has fallen due to improved material utilization and resource-optimized manufacturing processes.

The recycling rate for non-hazardous and hazardous waste has undergone continuous improvement to around 70% over the reporting period. This also had a positive impact on the volume of waste for disposal per vehicle.

Due to the increase in production volumes at new and existing production sites, both water consumption and wastewater volumes have risen. Values per vehicle also rose slightly in 2013 from 2012 values, but are still down from the 2010 baseline.