After our in-class reading about partnerships regarding sustainability, I was intrigued to see the Tesla Semi, a semi-truck has received 25 pre-orders from Canadian grocery store Loblaw’s. The partnership makes sense, as Loblaw wants to reduce its overall carbon footprint by 30%, by 2030, and they see more fuel-efficient transportation as a means to do so. Loblaw’s goal is to have a fully electric fleet by 230. The reason for reducing its footprint is because it is the required “fair contribution” (as determined by market share) set by WWF Canada to limit the rise of global temperatures to 2°C below pre-industrial levels.
http://www.loblaw.ca/content/dam/lclcorp/pdfs/Responsibility/Loblaw%20Carbon%20Reduction%20Strategy_EN.pdf (Full Size Image on Page 4/8)
Caption: A breakdown of Loblaw’s current and future projections to reach their carbon footprint goal by 2030
Tesla is a prime example of compliance as an opportunity. In fact, the EPA stated that medium and heavy-duty trucks account for 23% of vehicle emissions in the United States, as they travelled nearly 280 billion miles. Competitors like Daimler, the company that owns Mercedes-Benz, and Toyota are new entrants in this sphere by producing their own electric trucks.
But still, these companies playing catch-up are not nearly as highly valued for their innovations. These are the following sales numbers for the 4 most valuable car companies. Toyota outsells Telsa 132:1. Damiler outsells Tesla nearly 4:1. Tesla is still very infantile compared to these other companies, showcasing just how valuable a reputation of disruption and a credible first-mover advantage can be.
While pre-ordering trucks is not a partnership, it is an integrative supply chain decision, as it is a balance of improving the bottom-line while simultaneously addressing sustainability initiatives.
Integrative partnerships try to balance bottom-line considerations with social and ecological concerns. • Transformative partnerships seek wider societal improvement by meeting all partners’ objectives and empowering communities. Loblaw’s fleet will not get these trucks until at least 2019, as that is when Tesla will being production of the truck. This highlights how important it is to set long-term goals, as it allows companies to carefully examine opportunities and trends, and also allows them to be proactive rather than reactive.
Sources:
https://www.thestar.com/business/2017/11/17/loblaw-pre-orders-25-of-teslas-new-all-electric-trucks-for-undisclosed-price.html
http://www.loblaw.ca/content/dam/lclcorp/pdfs/Responsibility/Loblaw%20Carbon%20Reduction%20Strategy_EN.pdf (Image from here)
https://www.extremetech.com/extreme/249724-tesla-overtakes-bmw-toyota-daimler-vw-higher-total-market-value (Image from here)
Hi! Wow thanks for sharing, this is so great to hear. I didn’t know Loblaw’s was taking such a fantastic initiatives and it certainly makes me glad to know that at least they’re aware of their impact on the environment. They’re definitely making a bold statement by saying that they plan on reducing their carbon footprint by up to 30%. I definitely think that this is possible as long as they stick to their plan .These large corporation owe the duty to make long term sustainable goals and plans if they wish to operate at such large scales and grow quickly.
The other cool aspect about this is that we can see the power of partnership in action. This reminded me of the Ted Talk we watched in class at the beginning of the semester, we can only hope to solve these major issues through using the power of partnership to make real impact.
Hi,
I am impressed by Loblaws for purchasing vehicles that are able to reduce the emissions. As we all know, Tesla is well known for electrical cars and are friendlier to the environment, but they do not sell as many as other car manufacturers. Having a big corporation start using environmentally friendly trucks can have a big impact, as they use these trucks regularly to ship items. Sometimes, shipping trucks may be used many times in a day to deliver. Thus, having the decision to change regular trucks to electrical ones can significantly reduce gas emission. Hopefully, many companies that use delivery trucks will make the switch. Or even better, the car industry can
start developing more electrical trucks, so that more companies like Loblaws will start having more options on picking their trucks.
Thanks for sharing!
Great Post, I was watching Tesla release the trucks and was extremely impressed. I noticed in the release that individuals were poking holes in the new venture by trying to show why they would not be as valuable as current shipping methods. One thing to consider about these type of ideas is how we must not look at the negatives and should focus on the positive. In order to continue this innovations, we have to adapt and by lob-laws creating the venture, they showed their commitment to the future of the shipping industry.
One thing that caught my eye in this article was the term “compliance as an opportunity.” As I was not confident in my understanding of it I looked it up and discovered that this high-level concept relates to the idea that businesses can use regulations as a competitive advantage. (https://www2.deloitte.com/ca/en/pages/financial-services/articles/opportunity-in-compliance.html)
Although this term seems to be most commonly used in the financial and consulting sectors, I feel that it certainly is applicable to sustainability with the rising environmental restrictions on industries. The way that you have used this term an inter-business concept adds another level of complexity. Not only does it have to be imposed restrictions on your business- these restrictions can be goals set by another company, as Tesla is taking advantage of the environmental targets set by Loblaw’s.
Thank you for broadening my perspective on this concept!