Mercedes-Benz: Merc’s sustainability plans beyond auto tech

In an ET exclusive interview with KumKum Dasgupta, Mercedes-Benz board member Renata Jungo Brüngger lays out the luxury and commercial carmaker’s elaborate plans for a sustainable business – they go beyond climate protection.

India is a growing market for Mercedes-Benz. Recently, it sold 5,117 vehicles in Q3 2024, marking a robust 21% growth. The company’s battery EV portfolio has also garnered customer traction, growing by 84% y-o-y.

However, the company’s commitment to sustainability extends far beyond automobile tech, says Renata Jungo Brüngger, member, board of management, Mercedes-Benz Group AG for Integrity, Governance & Sustainability, who was in New Delhi this month.

‘Sustainability is a broad subject. It goes beyond climate protection,’ says Brüngger. About 8-10 years ago, the company realised the sector’s environmental footprint and the need for sustainable business. But building a sustainable business isn’t easy. M-B’s decarbonisation efforts are tied to its ‘Ambition 2039’ strategy, and the company’s goal is to ensure all new vehicles are 100% CO₂-neutral by 2039.

According to Brüngger, M-B believes that sustainability goes way beyond climate protection because economic, ecological, and social responsibilities are all interlinked. ‘That’s why we have been thinking about this holistically for many years now,’ she says. This holistic approach means that the firm’s sustainability agenda is spread across various issues:

● Recycle, reuse In Europe, recycling and reuse is an established practice, with many companies taking back old cars. M-B is building a battery recycling factory in Kuppenheim, Germany, cutting resource consumption and establishing closed-loop recycling of battery raw materials.● Leather-free interiors M-B offers various leather-free trim options in its vehicle interiors, including high-quality leather replicas and a microfibre nonwoven fabric that comprises 73% recycled material.Alternatives to genuine leather is in the Mercedes-Benz VISION EQXX model, made from renewable raw materials such as powdered cactus fibres or from mycelium, the root-like underground structure of mushrooms. Floor coverings in the M-B EQS sedan use nylon yarn from recycled carpets and fishing nets.

● Charging infra Last year, M-B opened its first high-power charging stations, implementing its far-reaching plans to expand its global charging infra. M-B charging hubs are operational in Atlanta, Chengdu, and Mannheim.

By end-2024, M-B aims to further expand its global charging network to over 2,000 high-power charging points. The long-term goal is to create more than 2,000 charging hubs with over 10,000 charging points by the end of the decade. The charging network is open to drivers of all brands. M-B customers enjoy special benefits. For example, the ability to reserve a charging point via the ‘Mercedes me Charge’ service to reduce waiting times.

● Cleaning up supply chain Ambition 2039 applies to suppliers also. Based on their annual purchasing volumes, 84% of suppliers have committed to supplying M-B factories with net carbon-neutral production materials by 2030.

● Human rights With electromobility, demand for materials like cobalt and lithium has surged, making supply chains more complex and vulnerable to human rights violations. Since 2011, the company has had a compliance system, ‘Human Rights Respect System,’ in place. This has been invaluable, especially with new supply chain due diligence laws in Germany and the EU, which require companies to closely monitor their supply chains.

M-B has tens of thousands of direct suppliers, and far more subcontractors. That’s why it takes a strategic and risk-based approach to achieve the greatest possible transparency across the upstream value chain.

‘We began by identifying 24 high-risk raw and processed materials in our products – including cobalt, lithium, graphite and nickel. This enables us to define and then implement targeted measures,’ says Brüngger. ‘We should not merely shift problems to other parts of the world in the transition to electromobility.’

● Governance for sustainability In Germany, the corporate governance code puts significant responsibility on the board and executive management to ensure they focus on sustainability.

● Traffic and road safety Safety is a core competency and core value for M-B and its automotive brands. Mercedes-Benz is known for developing highly sophisticated safety systems. In 2015, the company launched its ‘Safe Roads’ initiative in India. It’s a roadshow that spreads the message of road safety through physical demonstrations, visual aids, and research reports.

● Digital trust: These days, cars are packed with software, and data collection is part of the process. There’s AI and autonomous driving too. M-B has been working on data responsibility for years and has expanded that to digital trust because AI will play a role in the future. ‘It’s crucial to use this technology responsibly,’ says Brüngger.

Turning back to core sustainability issues, Brüngger firmly stresses that companies, civil society, regulators and governments must come together to meet green goals. But one must not lose focus on people, the soul of Mercedes-Benz. ‘Without our people, achieving a truly sustainable business is impossible,’ she says.