Not Every EV is Created Equal: A Look at Automakers’ Dirty Supply Chains

Not Every EV is Created Equal: A Look at Automakers’ Dirty Supply Chains

Over a million electric vehicles will be sold this year in the U.S. The EV transition is here to stay and is a critical component of keeping climate change under 1.5 degrees of warming.

But experts agree that automakers won’t hit their carbon reduction targets by simply cleaning up tailpipe emissions. They must also decarbonize the supply chain for the materials used to build vehicles. The EV transition is also an unprecedented opportunity to raise the bar for other aspects of the auto supply chain, like labor practices and the mining of minerals.

Lead the Charge, a coalition of organizations from around the world, holds automakers accountable by publishing a leaderboard evaluating 18 of the world's leading automakers on their efforts to eliminate emissions, environmental harms, and human rights violations from their supply chains. Cleaning up auto supply chains is critical to our shared electric future.

Coal-fired steel and aluminum

Automakers are some of the world’s biggest consumers of steel and aluminum. Steel and aluminum are typically manufactured using fossil fuel power. Over half of aluminum production is powered by coal, and as companies transition to EVs, the industry's demand for aluminum will double by 2050. And even worse, most automotive steel is smelted by burning coal in blast furnaces. Over 10 percent of carbon emissions worldwide come from steel and aluminum production, so cleaning up this industry offers huge potential to protect our shared climate.

Alternatives exist. Existing blast furnace facilities can transition to greener production methods like scrap-based electric arc furnaces and green hydrogen direct reduced iron. Switching to renewable energy for aluminum production can dramatically reduce emissions. Automakers are perfectly positioned to drive forward the decarbonization of the steel and aluminum industries, some of the world’s most polluting, by contracting with green suppliers.

One analysis found that it could cost automakers as little as $100 per vehicle to build with green steel instead of coal-powered steel. That’s an investment worth making.

Battery minerals

As automakers transition to electric vehicles, demand for battery minerals like nickel and cobalt is skyrocketing. The EV transition represents a once-in-an-industrial-revolution opportunity to create a whole new supply chain for the auto industry that doesn't repeat the poor practices of oil and other mining industries.

Without strong environmental protections, mining and refining minerals used for EVs can cause deforestation, threaten biodiversity, pollute air and waterways, and leave toxic tailings that can impact public health. If automakers and other industries don’t clean up battery supply chains as the world electrifies, then environmental degradation could discredit and slow the transition to EVs.

Automakers can help protect clean air and water around the world by holding suppliers to high standards with regard to transparency and traceability of minerals, environmental due diligence, and respect for human rights.

Labor and Indigenous sovereignty

Though much of U.S. auto manufacturing is unionized, the broader international auto supply chain is rife with corporations that tolerate discrimination, forced labor, low wages, and unsafe working conditions. One major automaker active in the U.S. was even in the news last year for employing child labor in factories in Alabama.

Respecting workers’ rights throughout the supply chain is essential for a just and sustainable EV transition. Otherwise, the EV transition will serve as a race to the bottom, pitting workers against each other and outsourcing jobs to wherever labor costs are lowest.

The EV transition also poses challenges to Indigenous sovereignty. One study found that over half of the minerals needed for the global clean energy transition are located on or near Indigenous lands. Automakers can do their part to ensure their supply chains respect Indigenous sovereignty and territories by requiring suppliers to obtain the Free, Prior, and Informed Consent of impacted Indigenous Peoples for any projects in their supply chain.

Consumers deserve a truly clean EV

More American drivers than ever before are going electric. Consumers deserve to know the truth about which automakers are failing to clean up their supply chains and which vehicles are manufactured with cleaner and more equitable practices.

To learn more about which automakers are leading the charge on cleaning up their supply chains, visit the Lead the Charge leaderboard at leadthecharge.org/scorecards-summary