Puma & BMW Helping To Build Sustainable Futures for our Feet and Wheels

To build a sustainable future, it is not be enough to just depend on the demands of a niche group of consumers, according to Jochen Zeitz, CEO and chairman of sportswear company Puma. Businesses have to take the first step by designing and manufacturing sustainable products and make them desirable for consumers. Another company with a commitment to designing and building sustainable products is car-maker BMW, which is looking to increase its investments in electric car production on the back of favourable demand for the battery-powered i3. Read more

Why Puma’s youngest-ever CEO says it’s up to business owners, not consumers, to drive sustainability

Myriam Robin in Smart Company (14 October 2013):

Plenty of businesses have found a niche selling environmentally sustainable products to consumers who care about such things.

But sustainability should not be a niche, says leading sustainability advocate Jochen Zeitz. It shouldn’t even be consumer-driven.

Zeitz became CEO and chairman of sportswear company Puma in 1993 when he was just 30, making him the company’s youngest ever CEO.

During his tenure at Puma, its share price rose 4000% over 13 years as he revamped the company’s operations and packaging as part of a sustainability agenda.

He’s since stepped down from Puma to focus on The B Team, a sustainability advocacy group he co-founded with entrepreneur Richard Branson, as well as his role as a director at Kering, which designs and manufactures apparel and accessories for the world’s leading luxury and lifestyle brands.

On his first visit to Australia as part of the Australian Sustainability Conference, he told SmartCompany that businesses have more control over the level of sustainable production in society than they think.

“When you sell a product, you’re selling its function on one side, but also its appeal. And you control its appeal. Most products are commodities, so we buy things because we like them. Sustainability needs to be packaged and made sexy, so consumers actually switch over from traditional products.

“The design of a product, and hence its sustainability, play a very critical role. We need to turn sustainability into something that’s desirable for the consumer.”

Zeitz says small businesses, being “the large companies of the future”, have a responsibility and an opportunity to take sustainability head on.

“Big corporations have a lot of baggage,” he says. “Small businesses are able to quickly take on sustainability and make it desirable.”

Plenty of small businesses are already doing this. Zeitz nominates the local food movement, which tries to limit the amount of distance between food being grown and food being eaten, as one example.

“That movement, which is growing tremendously, is driven by small businesses, from farmers to restaurants to supermarkets.”

The easiest thing small businesses can do to boost their sustainable credentials is to take a close look at their efficiency from a resource point of view, Zeitz says.

This requires measurement. At Puma, Zeitz pioneered a system of measuring all resources used in the company’s products, making sustainability a quantifiable goal across the organisation.

“Metrics are important in business, not just from a financial, but also from a managerial point of view,” he says. “We need to make sustainability part of day-to-day business. And proper metrics to that are important.”

Metrics and efficiency won’t be enough. Ultimately, Zeitz says, we need innovation in how we manufacture and ship products. But knowing what’s going wrong is an important start.

Source: www.smartcompany.com.a

BMW may lift investment in electric cars after i3′s fast start

The Age (15 October 15, 2013)

BMW, the world’s biggest maker of luxury vehicles, will have to increase investment in electric-car production if demand for the new i3 model continues in line with initial orders.

Customers have reserved more than 8,000 of the battery-powered i3, which will cost $US41,350 ($43,500) in the US, even before the car hits showrooms in Europe next month, Chief Financial Officer Friedrich Eichiner said today in Amsterdam.

BMW expects to sell more than 10,000 of the four-person car next year and “will adjust capacity according to demand,” he said at a press conference. “If demand holds, which is what it’s looking like, we will soon have to invest more.”

The maker of BMW, Mini and Rolls-Royce vehicles is upgrading its lineup with the i3, the new 4-Series coupe and a revamp of the X5 sport-utility vehicle to maintain its sales lead over Volkswagen AG’s Audi and Daimler’s Mercedes-Benz. Both competitors have vowed to surpass Munich-based BMW in deliveries by the end of the decade.

The i3 will go on sale in Germany for 34,950 euros ($50,100) on Nov. 16, followed by the US, China and Japan in the first half of next year. The model made its public debut July 29 at simultaneous events in New York, London and Beijing. The push to sell the electric car and recoup investments in the technology underpinning the vehicle include an international print, TV and Internet advertising campaign.

Margin targets

The spending on development of new models and expanding production capacity caused the operating profit margin at BMW’s auto division to narrow to 9.6 per cent in the second quarter from 11.6 per cent a year earlier.

“We’ll have to work very hard to keep profitability within our target corridor” of 8 per cent to 10 per cent in the coming years because of large investments required to meet stricter emissions regulations and the weak car market in Europe, Eichiner said today.

Sales gains in China and the US have helped BMW cushion the effects of the sovereign-debt crisis on Europe’s car market, which is sliding to a 20-year low. BMW, which doesn’t anticipate a recovery in demand in its home region before the second half of 2014, expects deliveries to rise this year for its third straight annual sales record.

“Demand in China and North America continues to be strong,” Eichiner said. “It makes sense for us to think about expanding production capacity in North America,” with the US and Mexico both options, he said.

The rollout of the i3 will go ahead as planned next month and won’t be impacted by issues that typically affect the ramp up of a new model, he said. The executive was responding to a report by Wirtschaftswoche over the weekend that problems bonding carbon-fiber components for the car led to a 10-day production halt.

Source: www.smh.com.au