Volvo Buses has set itself the ambitious target of reducing its greenhouse gas emissions in the supply chain by 25% already in 2025, and by 100% by 2040. The company’s ‘cradle-to-grave’ approach to greenhouse gas emissions means that reductions must be made across its full value chain.
“We need to look at the supply chain to be able to reach our goals. That includes working together with our supply partners to reduce their greenhouse gas footprint too,” says Kitty Muffolini, SVP Purchasing at Volvo Buses.
How AI can support decarbonization
To better support its suppliers in their decarbonization efforts, Volvo Buses will use AI. As a first step, it will take data from its own systems and gather all the details on each supplier and their respective part or component in a bus or coach. This will be combined with data from external environmental databases, to calculate the greenhouse gas emissions of each material included in the parts.
“AI will give us solid fact-based information and accurate data that we can then analyze and act on. We can also see carbon hotspots, making it easier to prioritize activities in collaboration with our supplier partners,” says Kitty Muffolini.
Once all this information is collected into one system, AI will be used to generate suggestions on how each supplier can reduce their greenhouse gases. It will also give proposals for parts that can be exchanged and replaced with lower emission alternatives.
Working together across the supply chain
The AI tool will be introduced stepwise and is expected to be fully operational by the beginning of 2025. The ambition going forward is to use AI-based insights as a basis for discussions with each supplier. Together with Volvo Buses, a decarbonization roadmap with set activities will be created and followed up over time.
“This will be a tool for everyone working with purchasing within Volvo Buses and Volvo Group,” says Kitty Muffolini. “It will be used to initiate discussions and be transparent together with the supplier. We are totally convinced that they have the same ambitions as us and that collaboration is the way forward to reduce greenhouse gases.”
