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Japan's three largest automakers face the greatest risk from climate change among global auto companies because much of their manufacturing remains concentrated in the island nation, according to a Greenpeace study.
Carmakers facing climate change risks
Toyota, Honda and Nissan will face big challenges in the coming years, from hurricanes and floods to high temperatures and water shortages, depending on the location of their factories, said the environmental advocacy group, which analyzed data from Moody's ESG Solutions on risks physical.
When it comes to environmental, social and governance issues, the focus is often on the impact manufacturers have on the climate or society. However, as changes in the weather make the impact of natural disasters more frequent and intense, automakers will face "a high level of physical risk" of damage and disruption to their operating facilities, as well as disruptions in the supply chain, Greenpeace said.
To some extent, the list reflects the realities of geography. Japanese automakers, which also have factories in Asia, have facilities spread across an archipelago susceptible to typhoons. The word itself means "great wind" in Japanese. Towards the bottom of the list of top automakers facing less, climate risk are Volkswagen Group, Stellantis and other European automakers with manufacturing facilities in northern climes.
Japanese automakers were severely affected by the 2011 earthquake and tsunami, which disrupted production and the supply chain. In response, Toyota and others restructured their supply chains, an overhaul that analysts say helped them weather chip shortages better than others.
Toyota, the world's number one in the sector, is the main affected, since more than 90% of its production plants would be highly exposed to at least one physical risk resulting from global warming (floods and hurricanes/typhoons, high temperatures, forest fires and drought ), indicates the study, based on data from Moody's ESG Solutions.
Ranking of the car manufacturers most exposed to climate change
- Toyota
- Sling
- Nissan
- General Motors
- Ford.
In the global ranking of the top ten, European manufacturers (Daimler, Stellantis, Renault and Volkswagen) are the least exposed.
This month, Toyota and Honda also had to suspend their production in some Chinese provinces due to the strong temperatures that hit the country and which caused power cuts.
What the Greenpeace study says
In his report, he insists on the case of Toyota, which should be more transparent about the climate risks to which its production plants are exposed and "take more forceful measures to reduce its carbon emissions," according to the NGO.
Current climate change is distinguished from past natural cycles by its speed and by the fact that it is due to human activities, according to United Nations experts.
"Toyota has solid experience in managing its operations in the event of disasters linked to climate change, earthquakes and fires," the Japanese group reacted on Friday.
"Since it is impossible to predict when, where and what kind of catastrophe will occur in each country and region", Toyota believes that it is "more important" to create a global system at the group level to minimize damage and cooperate as early as possible with its suppliers, "more than revealing the level of climate risk" faced by its factories in each of the countries in which the group is established.
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