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China FAW Group (中国第一汽车集团有限公司)

Known for Hongqi, Jiefang

China FAW Group Corporation is a state-owned auto manufacturer headquartered in Changchun, China. In 2019 it had US$89.67 billion in revenue and sales of over 3.1 million vehicles. 99.9 percent of FAW’s sales take place in China.

Summary

FAW Group has a performance score of 4.9 out of 20 against a well below 2-degree pathway. This is lower than the 2019 assessment, which assessed a subsidiary, FAW Car Company Limited. The subsidiary achieved a performance score of 7.0 against the less ambitious 2-degree pathway. In 2020, FAW Group (FAW) was assessed to include all auto manufacturing elements of the corporate group.

FAW’s decarbonisation efforts so far have focused on internal combustion engine efficiency improvements, which have occurred in line with the company’s well below 2-degree pathway. FAW takes an active role in policy engagement: the company reports sitting on the leadership board of 19 trade associations in 2019, none of which were deemed to have climate negative positioning. FAW has demonstrated its ability to engage suppliers by considering environmental standards in supplier selection and encouraging suppliers to report their use of harmful substances. The company can build on its current supplier engagement by collecting supplier emissions data and collaborating with them to set climate strategies.

Assessment Note: FAW Car Company Limited (a subsidiary of FAW Group) received a full ACT assessment in 2019.

Performance module name	Performance module score	Rank (0-30)
Targets	0.0 /3	#19
Material Investment	0.0 /0.4	#12
Intangible Investment	0.0 /2.4	#23
Sold product performance	4.0 /7	#12
Management	0.1 /2.2	#26
Supplier	0.3 /1.2	#10
Client	0.0 /0.8	#15
Policy Engagement	0.6 /1.2	#6
Business Model	0.0 /1.8	#27

FAW has made the first step in making a low-carbon transition plan. For instance, the FAW brand Hongqi launched a new energy technology strategy in July 2019. Honqi’s detailed plan and future impacts were also discussed in FAW’s corporate social responsibility report. However, the plans of other FAW brands were not found.

FAW should make a long-term plan at the group level and set emission targets to guide its actions. The company is still far behind on its pathway for low-carbon vehicle share, with low-carbon vehicles accounting for just 0.9 percent of sales in 2019, while its well below 2-degree pathway requires 5.7 percent. Moreover, FAW can expand into innovative and profitable business models that contribute to the low-carbon transition. Although FAW has jointly launched the car sharing schemes “T3 travel”, no evidence was found of the profitability of this business model.

See results for

2019
2021

More about the company

Headquarters: China
Ownership structure: State-owned
Revenue (2019): US$89.67 billion
Number of vehicles sold (2019): 3,111,635
Website: http://www.faw.com/fawen/index/index.html