Nature Positive Role of the Automotive Sector

Priority action 1 Avoid and reduce impacts from operations Companies should follow the mitigation hierarchy at the site level, in a landscape context, taking into consideration direct, indirect and cumulative impacts. They should first avoid impacts, then reduce impacts, restore, and finally compensate143 for unavoidable residual impacts.144, 145,146,147,148 Mitigation efforts should align with a No Net Loss (NNL) or BNG goal for each project.149 Improve water stewardship To protect nature and minimize the vulnerability of the sector to increasing risks from reduced water availability and quality, companies should conduct water risk assessments across the value chain. In particular, for direct operations, companies should conduct site-level water audits and risk assessments with a catchment-based approach and establish strategies to sustainably and responsibly manage water supplies, prioritizing sites in basins facing water stress. There are a number of actions companies can take to improve water stewardship, in particular: –Reduce water consumption, including by replacing water-cooling processes with air cooling or investing in updating or replacing water-using equipment to maximize efficiency. For example, Mahindra has installed an Electro Deposition Reverse Osmosis (EDOR) water recovery system at a sheet metal paint shop, which has increased overall paint recovery and reduced freshwater use by 22%.150 –Switch from freshwater to alternative water sources, including by harvesting rainwater or treating wastewater. For example, Mercedes- Benz collaborated with a municipal wastewater disposal company to replace freshwater with treated wastewater at their Sindelfingen plant, saving a total of 123,000 m3 of freshwater in 2023.151 –Recycle water back into operations, for example, by introducing closed-loop recycling systems or recycling treated wastewater back into operations. –Implement nature-based solutions, enhancing natural flood plains and riparian ecosystems to alleviate flood risks.152 –Support water replenishment across landscapes in priority watersheds in partnership with environmental NGOs, local governments and communities.Many companies have set targets to reduce freshwater withdrawal or average water use per vehicle. For example, Volvo Cars aims to reduce water withdrawal by 50% per car by 2030 (versus a 2018 baseline)153 and Pirelli aims to reduce water withdrawal by 43% by 2025 (versus a 2015 baseline).154 Other companies have established pilot plants that embed reduced water withdrawal and optimized water management. For example: –Hero Motor’s latest plants have been developed with a “green building” concept and are “zero liquid discharge”. Each uses rainwater harvesting systems to capture 2,500,000 m3 of water each year and is equipped with an effluent treatment plant that recycles 90% of wastewater back into operations, with the remaining 10% being reused for horticultural activities.155 –Hyundai has also established a zero-liquid discharge system to reuse and recycle 100% of the water they use at their Hyundai Motors India (HMI) plant and the Asan plant in South Korea. The company achieved this by adopting practices such as harvesting rainwater and expanding reservoirs.156 Avoid and reduce pollution Beyond the water stewardship actions outlined above, which can also help tackle water pollution, the following actions can directly support pollution reduction: –Improve monitoring of air emissions and other pollutants, for example, by implementing regular inspections to identify and tackle leaks. –Transform production processes and innovate to tackle pollutants, in particular, air pollutants from paint shops. This can be achieved, for instance, by increasing application efficiency and adopting sustainable chemical or non-chemical paints. For example, Mahindra applied a combination of new materials, automation and upgraded technology at their Chakan paint shop to reduce volatile organic compound (VOC) emissions by 52%. This initiative also improved chemical resistance and longevity and reduced paint cost by 17%.157 –Divert hazardous waste from landfills to recycle through authorized providers and take measures to avoid spillages (for more information on actions to address material waste, see priority action 2). To protect nature and minimize the vulnerability of the sector to increasing risks from reduced water availability and quality, companies should conduct water risk assessments across the value chain. 3.1 Avoid and reduce impacts from operationsPriority action 1 Nature Positive: Role of the Automotive Sector 30