Supply Chain Sustainability

We are working with our core suppliers to improve the sustainability of their products and processes. Our work with our Aligned Business Framework (ABF) suppliers to date has focused on providing support and resources to help them align with Ford's Code of Basic Working Conditions and implement supporting process, including responsible environmental management systems. Ford has committed to providing suppliers with a range of support and assistance based on our experiences in this area.

For example, during the fourth quarter of 2009, we held two sustainability sessions in Dearborn, Michigan, and Cologne, Germany, which were attended by senior management from Ford and our ABF suppliers. Topics covered in these meetings included internal training development guidance and best practice sharing from suppliers related to responsible working conditions and environmental management in their owned operations as well as with their suppliers. We also held a workshop discussion on the topic of carbon measurement and management in the automotive value chain. We are now working with our suppliers to improve environmental performance and have begun to engage with suppliers in the data collection and reporting of greenhouse gas emissions (see the Climate Change section for more information).

We are also working with our suppliers to increase their use of sustainable materials and eliminate undesirable materials. While Ford has already made great strides in using more sustainable materials (as discussed in the Sustainable Materials section), we can expand these efforts by systematically working with our suppliers on sustainable materials. Toward that end, we are developing Commodity Business Plans and other materials purchasing strategies that require the use of sustainable materials. For example, we developed a purchasing strategy for recycled plastics resins and Commodity Business Plans for relevant parts that require the use of post-consumer recycled plastics. Beginning in 2009, underbody aerodynamics shields, front splash shields, stone pecking cuffs and radiator air deflector shields manufactured in North America are made from the approved recycled plastics or ultra-lightweight, sound-absorbing textile materials with 30 percent to 40 percent recycled content.

In Europe and North America, we have added environmental requirements to the formal agreements that we make with our suppliers. These requirements cover a range of issues, such as reducing materials of concern, using Design for Sustainability principles, increasing the use of sustainable materials and using materials that will improve vehicle interior air quality. We ask suppliers to use recycled materials whenever technically and economically feasible. All recycled materials are evaluated in-house to guarantee that they deliver appropriate mechanical properties and the same level of performance that would be obtained with virgin materials.

Sales and Service Sustainability Initiatives

In early 2010, Ford announced a new dealer sustainability program. The "Go Green" Dealer Sustainability Program is a voluntary initiative for Ford and Lincoln Mercury dealers to reduce their carbon footprint and improve the energy efficiency of their dealerships. Through this program, Ford will collaborate with dealers to implement cost-effective ways to improve the energy efficiency of their facilities, resulting in a long-term reduction in the individual dealership's carbon footprint as well as overall operating costs.

Dealers who participate will first receive a comprehensive energy assessment from sustainability experts at Ford. After the thorough assessment is completed, Ford and the dealer will work together to identify the best energy-saving options that are available and tailor a program to meet the needs of the dealer. Possible solutions are wide-ranging and can be implemented for dealers with existing facilities, as well as dealers who are constructing new facilities. Participating dealers will receive guidance on available state and federal tax credits and incentives, as well as access to technical expertise and resources to assist with the selection of energy-efficient products and equipment.

Ford has partnered with the Rocky Mountain Institute to pilot emerging technologies and advanced facility design strategies at the pilot dealerships in varied climate locations. The first pilot project, which is being conducted at Jarrett Gordon Ford Lincoln Mercury in Winter Haven, Florida, involves a major renovation incorporating a majority of the technologies identified from on-site energy assessments. The technologies include LED lighting, improved building insulation, highly energy-efficient air conditioning equipment, as well as daylighting systems and natural ventilation. Studies are also underway to install renewable energy and make the dealership a net-zero energy (i.e., carbon neutral) building.