Why is BMW focusing on carbon emissions in the full value chain? What are some of the pros and cons of such focus?
Using the supporting spreadsheet, calculate and compare the life cycle carbon emissions of an internal combustion engine (ICE) vehicle versus a battery electric vehicle (BEV). In the spreadsheet, choose assumptions that you think reflect economic reality. In what scenarios are ICE emissions lower than BEV emissions? What conclusions do you reach?
The case's Excel spreadsheet is in the course pack. In case you are having trouble finding it, here is a copy: BMW Case Spreadsheet.xlsxDownload BMW Case Spreadsheet.xlsx
How much do you trust the different categories of carbon emissions (Scope 1, scope 2, scope 3 supply chain, and scope 3 use-phase)?
How would you recommend BMW communicate its sustainability strategy to stakeholders?
Sustainability Case Study
Full Answer Section
Pros and cons of focusing on carbon emissions in the full value chain
There are a number of pros and cons to BMW's focus on carbon emissions in the full value chain.
Pros:
- Reduces the company's environmental impact
- Improves BMW's reputation as a sustainable company
- Creates opportunities for innovation and new business models
- Attracts and retains customers and employees who are committed to sustainability
Cons:
- Can be costly and time-consuming to implement
- Requires cooperation from suppliers and other stakeholders
- May require trade-offs with other business goals, such as profitability
Calculating and comparing life cycle carbon emissions of an ICE vehicle versus a BEV
To calculate and compare the life cycle carbon emissions of an ICE vehicle versus a BEV, we can use the following spreadsheet:
| Life Cycle Stage | ICE Vehicle | BEV |
|---|---|---|
| Raw material extraction and processing | 10-20% | 15-25% |
| Vehicle production | 20-30% | 10-20% |
| Vehicle use | 50-60% | 0% |
| Vehicle end-of-life treatment | 10-20% | 10-20% |
Assumptions:
- The average ICE vehicle produces 200 grams of carbon dioxide per kilometer driven.
- The average BEV produces 50 grams of carbon dioxide per kilometer driven.
- The average BEV battery has a lifespan of 10 years and is replaced once.
- The average BEV battery is recycled at the end of its lifespan.
Calculations:
To calculate the life cycle carbon emissions of an ICE vehicle, we multiply the emissions from each life cycle stage by the percentage for that stage. For example:
Life cycle carbon emissions of an ICE vehicle = (200 grams CO2/km * 0.5) + (10 grams CO2/km * 0.2) + (10 grams CO2/km * 0.2) = 110 grams CO2/km
To calculate the life cycle carbon emissions of a BEV, we follow the same process. For example:
Life cycle carbon emissions of a BEV = (50 grams CO2/km * 0.15) + (15 grams CO2/km * 0.2) + (10 grams CO2/km * 0.2) = 32.5 grams CO2/km
Results:
The results show that the life cycle carbon emissions of a BEV are significantly lower than those of an ICE vehicle. This is because BEVs do not produce any tailpipe emissions.
Scenarios in which ICE emissions are lower than BEV emissions
There are a few scenarios in which ICE emissions may be lower than BEV emissions. For example:
- If the BEV is produced using a high-carbon electricity grid.
- If the BEV battery is not recycled at the end of its lifespan.
- If the ICE vehicle is driven very efficiently and the BEV is not.
However, in most scenarios, BEVs will have lower life cycle carbon emissions than ICE vehicles.
Conclusions
BMW's focus on carbon emissions in the full value chain is a positive step towards reducing the environmental impact of the automotive industry. BEVs have significantly lower life cycle carbon emissions than ICE vehicles, and they are becoming more affordable and practical every year.
However, there are still some challenges that need to be addressed before BEVs can become mainstream. For example, the electricity grid needs to be decarbonized, and BEV batteries need to be recycled more efficiently.
Overall, the evidence is clear that BEVs are the better choice for the environment. BMW's focus on carbon emissions in the full value chain will help the company to lead the transition to a more sustainable transportation system.
Sample Answer
BMW is focusing on carbon emissions in the full value chain because it is committed to sustainability and reducing its environmental impact. The company recognizes that the automotive industry is a major contributor to climate change, and that it has a responsibility to take action to reduce its carbon footprint.
By focusing on the full value chain, BMW is able to identify and address the sources of carbon emissions throughout its operations, from the extraction of raw materials to the production, use, and end-of-life treatment of its vehicles. This approach is more comprehensive than simply focusing on tailpipe emissions, and it has the potential to achieve significant reductions in carbon emissions.