Ford today released its 2022 Integrated Sustainability and Financial Report focused on its transition to EVs, including plans to boost production to 2 million electric vehicles per year by 2026 and to make half of its annual sales volume electric by the end of the decade.
“Ford has committed to achieve carbon neutrality no later than 2050, backed by science-based interim targets it will meet by 2035. The new report features voluntary disclosures on climate related information and details [our] progress to reduce emissions per vehicle by 50% from a 2019 base year and emissions from operations by 76% from a 2017 base,” the automaker said in a statement.
“Last year, the company achieved a 35% reduction in its absolute manufacturing greenhouse gas footprint from 2017 levels.”
Ford said the shift to electric vehicles was critical to achieving its sustainability goals, but such a transition came with challenges including raw materials sourcing, end life battery recycling and human rights issues.
Ford also released a human rights report, a first for the company and the US auto industry, and a combined task force on climate related financial disclosures and climate risk scenario report.
“The truest mark of success is whether we leave the world a better place for the next generation. Each year, our integrated report reminds me of our commitment to our values, and our drive to move the needle on the issues that matter. This has been true since we launched the report 23 years ago, a first for the industry. And it could not be truer today,” said executive chair Bill Ford.
“[The] human rights report… will examine how our materials are sourced, where our products are manufactured and how our labour standards measure up. I am proud of the progress we have made over the last two decades and look forward to our continued accomplishments.”
To “compete and win in a new era of electric and connected vehicles”, Ford plans to invest US$50 billion globally from 2022 through 2026 to develop electric vehicles and their batteries. The company will do so from what it claimed were “some of the most advanced and efficient auto factories in the world, creating thousands of new jobs and building a sustainable and ethical supply chain”.
“This year’s report is significant because it demonstrates Ford’s longstanding commitment to transparency and holding ourselves accountable,” said Cynthia Williams, global director of sustainability, homologation and compliance.
“It gives our stakeholders a clear picture of how we are going to put people first and respect human rights as we transition to electric vehicles, building on our legacy of climate action and environmental protection. Our company strategy and sustainability goals are indelibly linked – what’s good for the planet is good for our customers and our business.”
The 2022 Integrated Sustainability and Financial Report outlines how the Ford+ plan for growth and value creation builds on the company’s significant foundational strengths to scale electric vehicle production and harness connectivity and disruptive technology to make its products more accessible, more inclusive and safer to drive.
Ford was one of the first US automakers to align with the international community to limit global warming as part of the Paris Agreement, and the company’s goal is to build a business model that goes beyond net zero and becomes net positive.
Highlights from the 2021 integrated report:
• Ford joined RouteZero, a global coalition to curb global warming by working towards aking sales of all new cars and vans zero-emissions by 2040 globally, and no later than 2035 in leading markets
• The company introduced a sustainable financing framework to guide investments in social and environmental projects, paving the way for an inaugural ‘green’ bond which raised $2.5 billion via a 10-year issuance to help fund the company’s new line of EVs
• Ford and SK Innovation announced a planned joint investment of $11.4 billion in BlueOval City and three BlueOval SK joint-venture battery plants in Kentucky and Tennessee – megasites which will create nearly 11,000 new jobs and contribute to generating a sustainable manufacturing ecosystem. Ford is also investing $525 million over the next five years on professional development and training for auto technicians to service electric and connected vehicles
• Ford is collaborating with Redwood Materials, a battery materials company, to make electric vehicles more sustainable and affordable for Americans, localising the supply chain network to create recycling options for scrap and end of life batteries and ramping up recycling of lithium ion batteries. Ford also plans to open a global battery centre in southeast Michigan, Ion Park, with new investments to develop, test and build battery cells and cell arrays focusing on lithium ion while looking at solid state battery technology
• The company joined the U.S. Department of Energy’s Better Climate Challenge to reduce greenhouse gas emissions from its facilities by at least half by 2030, in line with a commitment to power its facilities with 100% carbon-free electricity by 2035
• Ford has reduced its annual water consumption by more than 78% from 2000 levels, and established 89 zero-waste to landfill sites globally while reducing its global manufacturing carbon footprint by more than 35% from 2017 levels
• The company set new diversity, equity and inclusion (DEI) goal to increase gender and racial diversity in its senior leadership, tracking this quarterly. It expanded its US diversity, equity and inclusion audit to seven additional major markets in 2021, and advances pay equity
• Along with its philanthropic arm Ford Fund, the automaker made $74.4 million in charitable contributions to build equity and empower under served and under represented communities around the world. Together, Ford and Ford Fund donated 120 million masks to at risk individuals and organisations in all 50 states to help fight the spread of COVID-19, opened a community vaccine centre in Romania, and distributed food and medical kits to thousands of families in South America, among other initiatives
“Operating results and other metrics from 2021 show that the Ford+ plan for growth and value creation is working,” the automaker said.
Revenue, net income and adjusted earnings before interest and taxes all improved year over year, despite industrywide semiconductor shortages, other supply chain disruptions and the ongoing effects of the COVID-19 pandemic.
“The company is making tremendous progress in both the strategic direction and financial performance of the business.”
This is the second year Ford has brought its annual financial and sustainability reports together “to give a more holistic view of its progress, marking 23 years of transparency and rigor in sustainability reporting for investors and stakeholders”.
Editor’s note: The full Integrated Sustainability and Financial Report can be read at sustainability.ford.com.