In the realm of methanol-powered vehicles, no one in the automotive industry is more dedicated than Li Shufu.
In February last year, Geely saw the launch of a 100,000-ton green and low-carbon methanol plant, further expanding its green methanol ecosystem. This marks a new beacon lit by Geely for China's energy diversification strategy and stands as a significant event in Geely's 2023 sustainability efforts.
As a company grows larger, strategizing for sustainability becomes imperative. Integrating sustainable development strategies into a company's DNA means not only focusing on finances and performance but also on the well-being of humanity and the planet, ultimately benefiting the company's business growth.
Recently, Geely Holding also released its 2023 Sustainability Report, a 126-page document revealing Geely's progress in six key strategic areas: compliance and business ethics, climate action, resource conservation, transportation, value chain responsibility, and employees and communities.
Aligned with their established goals, Geely aims to achieve operational carbon neutrality by 2030 and full lifecycle carbon neutrality by 2045. In comparison to the baseline year of 2020, Geely has reduced per-vehicle lifecycle carbon emissions by 12% in 2023, with a 16.2% decrease in average carbon emissions at the usage stage and a 53.7% reduction in carbon emissions at the manufacturing stage.
In 2023, facing multiple challenges in the global environment, society, and economy, Li Shufu emphasized the importance of sustainable operations and enhancing risk prevention capabilities in a complex international environment. Geely Holding deeply understands the significance of adhering to the path of high-quality development and consciously practicing the concept of a community of shared future for mankind.
Using green methanol to solve the world's energy challenges has always been Li Shufu's goal and dream. He openly states that Geely aims to be a pioneer in new energy power, achieving the transformation to green energy, safeguarding China's energy security, and driving global energy technology advancement.
As one of the earliest Chinese companies to join the United Nations Global Compact, Geely Holdings' sustainable development strategy goes beyond just methanol vehicles. It is dedicated to exploring a Chinese-style carbon-neutral path suitable for the field of automotive travel.
Currently, Geely is simultaneously exploring diverse new energy technology paths such as pure electric, hybrid, plug-in hybrid/extended range, green methanol, battery swapping, and has set an overall goal to achieve full-chain carbon neutrality by 2045.
Under the overall goal, Geely has also outlined short-term, medium-term, and long-term plans, aiming to reduce the carbon emissions of each passenger vehicle's entire lifecycle by 25% by 2025, achieve carbon neutrality across the entire group's operations by 2030, and be ready for zero carbon emissions in its own operations by 2040. Zero carbon readiness means having the conditions in place to achieve zero emissions even if it hasn't been fully realized.
On a national scale, China's "dual carbon" goal aims to peak carbon emissions before 2030 and achieve carbon neutrality by 2060. In other words, Geely is ahead of the country's carbon neutrality target by 15 years.
In some specific goals, we also note that Geely has committed to forming a clear natural benefit commercial transformation path by 2025, establishing a virtuous cycle between natural resources and business development. In other words, a year from now, Geely will be able to follow a clear path to achieve a balanced interaction between production operations and natural ecological resources.
In fact, sustainability reports are often considered as a company's second financial report. As a listed company, Geely has been releasing reports for 12 consecutive years, and last year it disclosed its corporate ESG strategy covering six major areas for the first time, focusing on compliance and business ethics, climate action, resource protection, transportation, value chain responsibility, and employees and communities.
Geely has also explicitly stated its ambition to become a benchmark for carbon neutrality in China. Therefore, at Geely Holding, the board of directors is responsible for overseeing sustainability-related work, indicating a high strategic level. In 2023, to enhance management coordination, Geely Holding also optimized its sustainable development organizational structure.
Of course, a sustainable development strategy that encompasses all aspects of the product to the entire value chain is undoubtedly a systematic battle. With regulations and capital markets increasingly demanding stringent disclosure standards for sustainable development strategies, automotive companies are accelerating their actual performance and systematic management of sustainability-related matters.
For Geely, a clear indicator is that by 2023, its sales of new energy vehicles had exceeded 980,000 units, accounting for over 35% of total sales, with a 51% year-on-year increase, significantly reducing carbon emissions from vehicle usage.
Geely is integrating new materials and technologies into the entire vehicle lifecycle value chain to achieve low carbon and circular utilization. For example, models like the Geely Galaxy E8 and Lynk & Co 08 incorporate over 30 lightweight technologies such as integrated hot-formed door rings and aerospace-grade aluminum alloys. The polyester fibers used in the Volvo EX30 interior can be recycled up to 100%.
On the production side, Geely already has three zero-carbon factories and 17 "national green factories." The Volvo Taizhou factory has become its first climate-neutral factory in China, and new energy low-carbon vehicles are used for logistics transportation, enhancing the company's independent emission reduction capabilities.
According to the phased emission reduction targets set by various brands under Geely Group, Caocao Mobility achieved operational carbon neutrality in 2023; Geely Auto aims to reduce per-vehicle lifecycle carbon emissions by over 25% by 2025 (based on 2020 levels); Volvo aims for global climate-neutral manufacturing operations by 2025; Lotus Technology plans to achieve a 100% pure electric vehicle product lineup by 2027; Farizon New Energy Commercial Group aims for carbon neutrality by 2030; and Polestar aims to halve greenhouse gas emissions by 2030 (based on 2020 levels).
As a responsible automotive group, Geely believes that sustainable development is not an optional choice but a necessary one. Under the national "dual carbon" goals, implementing a sustainable development strategy can promote the integration of ecological, economic, and social benefits. This extends beyond its own production and manufacturing layout to also include driving the establishment of sustainable development standards for the entire industry chain of suppliers.
Geely Auto has incorporated sustainable development capabilities into its supplier evaluation system and updated the "Geely Supplier Code of Conduct" in 2023 to further clarify its standards in environmental and social responsibility. This includes supplementing detailed requirements for working conditions and human rights, business ethics, communication, and training, driving suppliers to fully comply. The self-developed Geely TraceCloud blockchain traceability platform has been put into use, involving brands such as Volvo, Polestar, Geely, and Lotus, enabling full lifecycle traceability from the entire vehicle back to the raw material suppliers.
In terms of organizational structure, Geely has established a Supply Chain Coordination Committee at the group level, with subordinate executive bodies responsible for advancing strategic tasks and management requirements.
As we all know, the automotive industry chain is long and wide-reaching. By building a group of suppliers that respond to sustainable development strategies, it will not only impact direct stakeholders but also collectively provide sustainable value for the industry and society. Geely is continuously optimizing its talent development system to reward employees throughout their lifecycle.
According to Geely Holding CEO Li Donghui, the concept of sustainable development and ESG practices also better promote Geely's business growth. The total group car sales in 2023 are around 2.79 million units, representing a year-on-year growth of about 20%, which is proof of this.
He stated, "Geely Holding Group will, on a globally compliant basis, be driven by talent and technological innovation, centered on user experience, continuously creating economic, environmental, and social value."
