Miele holds an event at IFA, a major trade show for consumer
electronics and home appliances, in Berlin on September 4, 2019. Photo: AFP
High end German home appliance maker Miele has turned to low
carbon “green steel” to decarbonise its supply chain, as it seeks to bolster
the sustainability credentials of its products known for their durability.
Last November, the 123 year-old company launched a pilot project
to source around 24 tonnes of low carbon steel a month from German steel maker
Salzgitter for use in its cookers and ovens measuring 60cm in size.
“This is a pilot project,” said Kenny Lam, managing director of
Miele Hong Kong and Macau. “There are still uncertainties [in the pace of
adoption] as the worldwide availability of green steel is quite limited and the
costs are higher.”
The carbon dioxide generated by the process is around two-thirds
lower than that of steel produced by conventional blast furnaces, a fact
verified by Munich-based safety and quality certification provider TUV Sud,
according to Miele.
The reduction comes because green steel
is produced in an electric arc furnace powered by low carbon energy sources, as
well as from recycling by using scrap steel.
In the longer term, Salzgitter aims to use green hydrogen produced from
renewable energy in its green steel production process, to further reduce the
carbon footprint to less than 5 per cent of conventional steel.
Miele also aims to raise its annual use of recycled plastic to
7,500 tonnes by 2025 from 194 tonnes currently, mainly for use in making vacuum
cleaners.
Most of the firm’s kitchen, laundry appliance and vacuum cleaner
production facilities are in Germany, while the remainder are in Austria,
eastern Europe and Dongguan, southern China.
Miele, based in the northwest German city of Gütersloh, last
year began to fully offset the carbon dioxide generated from its own fossil
fuel combustion and that of its energy suppliers. It also said it would aim to
slash such emissions by half by 2030 from 2019 levels.
In the same time frame, it aims to cut
by 15 per cent so-called “scope 3” carbon emissions generated by customer usage
of its appliances, logistics services and materials consumed in its supply
chain.
Scope 3 emissions make up around 80 per cent of the company’s
overall carbon footprint across its supply chain.
Being privately-owned, Miele has the flexibility to balance
returns and sustainability without pressure from shareholders to meet short
term profit objectives, Lam said.
Miele bases its calculation of scope 3 emissions on a 20 year
product lifetime, which Lam said is around three times the industry norm and
the key to reducing life cycle emissions.
An
employee carries out the final inspection of a dishwasher on a production line
at Miele in Germany. Photo: Friso Gentsch/picture alliance via Getty Images
“Long-lasting products are in our DNA,” Lam said. “From design,
materials and components, all our products are tested in-house to last at least
20 years. Customers are honest. If we fail to meet their quality expectations,
they will punish us.”
In 2021, Miele’s sales grew 7.5 per cent year on year to a
record €4.8 billion (US$5 billion), thanks to stay-at-home-related purchases.
Despite semiconductor shortages, pandemic-related logistics
challenges, and a shift in consumer spending back to services from hard
products after social distancing measures were eased in many nations, Miele is
targeting revenues to surpass €5 billion this year and has set a goal of €8
billion by 2030.
“While overall industry demand has fallen back, sales in our
segment are still growing,” Lam said, adding that Europe accounts for around 70
per cent of Miele’s revenue, while Asia-Pacific contributes 15 per cent.