Daimler AG

Although Daimler’s fleet emissions began at relatively high levels, the company has made steady progress to reduce them, albeit with a slight increase in 2017. Daimler’s current reduction rate aligns with the low-carbon pathway. Similarly, Daimler’s internal combustion engine efficiency has improved in line with the pathway, though again with a slight deterioration in 2017. However, even with these emission efficiency improvements the company’s fleet emissions are still above its allotted carbon budget under the low-carbon pathway.

As Daimler only has short-term targets, its current use of target setting is unlikely to drive sufficient low-carbon action. Daimler should better align itself with the low-carbon pathway by improving its target setting approach, particularly for fleet emissions.

Daimler could improve its low-carbon transition alignment with management focus. Adding climate change expertise at the board level could improve Daimler’s chance of a successful low-carbon transition. It should also consider consolidating its low-carbon planning and analysis into on public document to demonstrate its commitment to the transition.

Daimler has committed to systematic electrification of its entire range of passenger vehicles. It has planned for more than 130 electric vehicle models. The company states that by 2025, electric vehicles will account for 15 to 25 percent of its sales. Daimler is also aiming for net zero manufacturing emissions by 2022.

Daimler is buying batteries while also expanding its battery production. The new EQC model is part of an electric offensive to be integrated into current production operations. The EQ brand plan includes a comprehensive electric mobility ecosystem of products, services, technologies and innovations. The company recently announced a halt to new internal combustion engine development. The broader Daimler Group makes passenger vans, trucks and buses that are also being electrified. Moreover, Daimler is shifting to renewable electricity use across all of its plants and to carbon neutral on-site power generation.

Daimler’s fleet emissions efficiency is currently aligned with the level required for the low-carbon pathway. However, despite these efficiencies, the cumulative emissions of vehicles already sold and project to be sold are higher that the carbon budget allocated to the company. Helping further reduce these emissions, Daimler has increased its share of sales from low-carbon passenger vehicles from less than 0.1 percent in 2012 to nearly 1.5 percent in 2017.

Starting from relatively high levels, Daimler has successfully reduced fleet emissions intensity at a rate aligned with the low-carbon pathway. The share of sales that come from low-carbon vehicles has also increased, but this growth is currently not aligned to the low-carbon pathway. The company’s past emissions reductions target setting has also been poor. While Daimler has initiated car sharing and leasing initiatives, it could demonstrate a greater commitment to growing such business activities.

While Daimler’s current sold product performance is relatively strong, it needs to increase its efforts in low-carbon vehicle sales to transition to a low-carbon economy. Moreover, the company does not have strong consumer engagement programmes promoting electric vehicles over conventional internal combustion engine vehicles, despite its ambitious aims to produce and sell more low-carbon vehicles. Similarly, there was little evidence of Daimler actively supporting more ambitious decarbonisation legislation, nor was any evidence found of significant investments to speed up the provision of electric vehicle charging infrastructure.