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May 31, 2017 02:00 AM

GM partners with tire producers on new sources of NR

Kyle Brown
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    Kyle Brown, Rubbe & Plastics News
    Discussing the importance of sustainably sourced natural rubber at General Motors' news conference are, from left,: David Tulauskas, GM director of sustainability; Steve Kiefer, GM's senior vice president of global purchasing and supply chain; Peter Ramirez, Michelin North America sustainability project manager; Mark Purtilar, Goodyear vice president of global procurement; Juan Botero, Continental the Americas vice president sales, original equipment, passenger & light truck tires; and Jim DeMouy, Bridgestone vice president of environmental, health, safety and sustainability.

    DETROIT—General Motors Co. is collaborating with rubber and tire suppliers to establish a plan to source more rubber through environmentally sound and sustainable natural rubber production.

    GM is establishing commitments with suppliers such as Bridgestone Americas Inc., Continental Tire the Americas, Goodyear and Michelin to develop the details of that plan, according to Steve Kiefer, GM's senior vice president of global purchasing and supply chain.

    "GM is a global company that's really here to serve our customers and try to improve the communities in which we live and work," Kiefer said at a May 15 news conference that included the four tire suppliers. "Doing this, we must really think historically and realistically about our impact on the environment, and really engage the entire value chain, including our supply chain partners."

    GM is the first auto maker to commit to sourcing sustainable NR in its tires for the future, Kiefer said, and while the car maker might not be the largest user of NR, its volume can have a significant impact on the industry and environment. GM currently sources more than 49 million tires each year, a total of 80 percent coming from the four suppliers at the press conference.

    "Through this commitment, GM will develop a set of purchasing requirements with the intent to accelerate the progress that's already being made by all of our suppliers to develop solutions for barriers that remain, such as traceability of rubber from farm to factory, and assurance on the responsible practices of the use of this commodity," Kiefer said.

    Mapping the supply chain

    One early step in that plan is working with tire suppliers to map out the supply chain to develop better transparency into NR and ensure its traceability. But making that map is more difficult than it looks, according to Peter Ramirez, Michelin North America sustainability project manager.

    "We've talked about supply chain complexity. We estimate there's more than 6 million individual farmers in the supply chain, at the lowest-level basis of this," Ramirez said. "Above that, there's some 5,000 dealers and 200 suppliers, and we all buy from the same suppliers."

    About 12 million tons of NR are purchased each year, and the tire industry accounts for about 75 percent of that purchase, according to Ramirez.

    Nailing down each part of that chain is difficult, especially when it gets down to the individual grower, said Jim DeMouy, Bridgestone vice president of environmental, health, safety and sustainability.

    A country like Indonesia has "a conglomeration of a lot of small rubber farmers. These are individual families that have two to three hectares to plant, and that's their livelihood," he said. "I think there's a lot of work we still have to do to gather that data and also be able to manage this process."

    Suppliers began efforts to map the chain in 2015, developing a mobile application used in Indonesia and Thailand to map areas with high conservation values and carbon stock to visually see regions with the potential for high social risk. The current goal is to map 80 percent of NR purchases by 2020, Ramirez said.

    "I think we're in the early stages of this process. It's a very complex value chain, and we have done significant steps as an industry," said Juan Botero, Continental vice president sales, original equipment, passenger and light truck tires for the Americas. "It's still a long way for us to go."

    Though GM has an idea of how much sustainable rubber is used currently in its tires, Kiefer hesitated to quantify the volume. The issue of traceability makes it difficult to specifically gauge the challenge the industry faces.

    "We don't completely know how big the issue is, or how deep this goes," he said. "I would say we'll have a better answer over the coming months."

    Planning the journey

    With industry support, GM expects to develop an industry road map by the end of the year.

    In June, GM will host a workshop at Michelin's Movin' On Conference, kicking off a series of multi-stakeholder dialogues and exchanges to discuss the company's commitment.

    GM then will work with other auto makers to advance the movement, and some talks with other OEMs already have started, said Kiefer.

    "I would say the other OEMs, from my interaction, are also very interested," he said. "GM cannot do it alone. In the industry, we're a large player, but we're not the only player. I think it's critical. That's why we're going so public right now, to try to get more industry support for this, and try to bring the rest of the industry along."

    Bringing other vehicle producers on board with the effort is key to success, said Mark Purtilar, Goodyear vice president of global procurement.

    "It's very important for us all to come together as a single standard that we can all follow and be able to manage throughout the supply chain," he said.

    Along with other auto makers, GM also will work with non-governmental organizations such as the World Wildlife Fund to encourage progress. The WWF welcomed GM's commitment to bring its top suppliers on board in a statement.

    "(We) hope today's announcement will inspire auto makers and tire makers alike to deliver on the promise of zero deforestation in the near future," said a WWF spokeswoman.

    Impact on costs

    Future changes in cost connected to the process are possible, but additional cost shouldn't be assumed with a more sustainable direction, Kiefer said.

    "We don't think these things are mutually exclusive. We don't think quality and cost are mutually exclusive," he said. "We certainly don't think that sustainability and cost are mutually exclusive. Working with the supply base, I think there's plenty of opportunities to become more sustainable and at least maintain or even improve cost structure."

    The overall solution for establishing transparency and traceability in the supply chain, as it is developed in the industry, will dictate whether or not cost will add to the equation, Ramirez said.

    Additionally, using sustainable practices means more than just ensuring that the rubber is harvested responsibly, DeMouy said.

    "We try to take a holistic view on sustainable natural rubber," he said. "It's human rights. It's land use. It's all kinds of aspects. We want to establish a thriving industry on this."

    Beyond those practices and protections of farmers and environments, using sustainable practices will help the industry keep pace with demand, which is expected to continue to grow, Botero said.

    Consumers also have built momentum to support industry efforts to create products sustainably. "As the industry grows, mass production will not decrease. It will increase," he said. "What we need to do as an industry is make sure that we approach things with a sustainable model."

    Rising expectations

    Ramirez said that both consumers and employees alike are expecting tire makers to evolve in this manner.

    "This is an area where between now and 2050, the number of vehicles worldwide is expected to double," he said. "So how do we put in place sustainable practices today that ensure sustainability for years to come?"

    In recent years, tire suppliers have pursued different strategies, both to encourage more sustainable growth and harvest of natural rubber and to develop alternative sources. All four of the suppliers at the press conference are part of the Sustainable Natural Rubber Initiative, which is an inter-governmental organization developed to determine best practices for sustainable harvesting.

    The companies also have their own individual efforts for sustainable rubber sourcing and production, several of which were mentioned at the press conference.

    Last month, Bridgestone debuted its "Our Way to Serve" as a refinement of its global corporate social responsibility commitment, which includes sustainability under the three priority areas of mobility, people and environment.

    In 2016 Michelin announced its Zero Deforestation program, which determines that the company will use all reasonable means to source natural rubber exclusively from plantations that comply with zero deforestation principles.

    Bridgestone currently is working on commercializing the guayule desert shrub as a substitute for natural rubber at the Bridgestone Biorubber Process Research Center in Arizona, according to DeMouy.

    And Goodyear recently introduced technology using rice husk ash silica, which can be used in tires to lower rolling resistance, and is using soybean oil as a sustainable alternative to process oils in rubber production, Purtilar said.

    Continental is working on using Taraxacum kok-saghyz, commonly known as the Russian dandelion, as an NR substitute under the trade name "Taraxagum."

    Goodyear also is studying the plant through the Program for Excellence in Natural Rubber Alternatives, sponsored by Ohio State University.

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