The climate in the automotive industry is anything but clear, and it seems some of the leading industry CEOs are trying to do something about it.
Before the historic climate change agreement by world leaders in Paris last month, leaders from the auto industry in Europe, Asia and the U.S., 13 CEOs in all, signed an agreement to decarbonize automotive transportation.
Companies represented were General Motors, Volvo Group, Fiat Chrysler Automobiles, Ford Motor, Nissan-Renault Alliance, Beijing Automotive Group, and Mahindra & Mahindra from India. There were also some of the largest auto parts suppliers represented as well. They all signed a two-page commitment toward the development of cleaner vehicles and other initiatives to reduce the harmful greenhouse gas emissions now strongly prevalent in the environment.
They also noted further help from industries outside the auto industry is needed to accomplish this goal. Industries such as those needed to develop cleaner fuels, build opportunities for alternative fuels and build business models including traffic reduction.
The premise of the commitment was, in taking this action collectively, the automakers’ would produce more of an impact globally. The result was staggering, succeeding to get these companies and their CEOs together to agree on this unprecedented commitment.
But a key question remains. In light of the scandal with Volkswagen over emissions test cheating, where were they in this agreement? They are not present. Neither is Toyota. And together, these two automakers make up one in every four vehicles sold on the earth. And of the automakers’ 10 largest companies, only four signed the commitment.
Nevertheless, Alex Molinaroli, chief executive of auto supplier Johnson Controls and who chairs the World Economic Forum’s Automotive Industry Community said in a recent interview with Forbes Magazine, “Just being able to get all these individuals in a room to come up with a statement that we can all stand behind is a major achievement….I would not look at the absence of a signature as not being supportive,” he commented. He went on to say that, “What you see is a large, significant, impactful leadership group that have signed up, along with their suppliers. I choose to look at it as the positive. It will only pick up steam from here.”
No doubt the effort put forth by this impressive group is in the right direction. And in the wake of the VW scandal they are well served to do something to help the tarnished image of automakers in today’s climate. The group is meeting again this coming January in Davos, Switzerland to determine how they are going to implement their plans.
One can only hope the plans will be implemented with intention, and this is not just a giant pose on the part of the automakers to offset the recent troubles in the industry. The results of Davos will show.