The Volvo Group’s future success depends on our ability to continue to deliver innovative and sustainable transport solutions that can be converted into financially viable products and services.
There are six stages to the Volvo Group product development cycle, as shown in the ‘Product development cycle’ diagram below. Each stage has different quality, safety and environmental objec- tives that need to be met before proceeding to the next stage. Developing a completely new vehicle can take up to four years, sometimes longer if a new powertrain is included.
In 2014, we operated from a strong product portfolio following the Group’s most extensive product renewal during 2013.
Investing in sustainable R&D
2014 investments in research and development (R&D) amounted to SEK 16.7 billion, (15.1 bn).
R&D expenditure was lower than in 2013, but was offset by lower capitalization, thereby contributing to an overall increase in cost. The decreased expenditure level for R&D was planned following the launch of the new ranges for the Volvo and Renault brands, and implemented cost saving measures.
To stay at the forefront on fuel economy, the Volvo Group works to improve the performance of our products and to fulfill our devel- opment objectives:
• Each new product shall have less environmental impact than the product it replaces
• New products and major updates shall implement state-of-the-art technologies that make them better than those they replace Areas of focus
Our product development is driven by the cost and availability of fuel, environmental legislation and new technologies. We have therefore chosen to focus our long-term research and development, advanced engineering and technology on solutions that improve the sustainability of our products and the transport industry, with signif- icant investment in:
• CO2 and energy efficiency • Vehicle and traffic safety • Transport solutions
Read more in the Sustainable Transport Solutions section of this report.
FOCUSING ON ENERGY AND RESOURCE EFFICIENCY Focusing our product development on using resources and energy more efficiently simultaneously reduces the overall environmental footprint of our products while supporting our customers’ profitability.
Assessing the whole lifecycle of our products
We conduct whole lifecycle assessments (LCAs) for our products, taking into account all environmental impacts from the production and use of raw materials, energy and water consumption and the creation of waste, as well as emissions to air and water.
Producing the truckFuel consumption Emissions Maintenanc e Recycling 49 59 28 Use phase, 94% 7 –43 Environmental impact Renault Trucks Model: T-range High tractor 4x2 Euro 6, %
Our environmental impact is calculated according to the EPS 2000 (Environmental Priority Strategies in product development) method, where environmental impact is calculated as the willingness for an average OECD citizen to pay for the damage to five safeguard sub- jects: human health, biological diversity, eco-system production, natural resources and aesthetic values.
The Volvo Group’s LCAs clearly demonstrate that the vast major- ity of a product’s environmental impact results from its use – more than 90%.
The total weight of a truck, such as a Volvo FH tractor, is approxi- mately 7,000 kg. It is estimated that 45% of a typical Volvo truck is produced from recycled material. Despite the high amount of recycled content, virgin material is still needed to ensure quality and solidity.
In addition, the use of scarce metals, such as platinum and palla- dium, constitutes a high environmental impact during production that is offset through recycling at the end of the product’s lifecycle. Considering all critical materials
The European Commission has listed 20 raw materials as ‘critical’ in terms of risks for future supply. In the short and medium term, changes in the geopolitical economy carry the highest risks for market shortages, together with growing raw material demand, trig- gered by growth in developing economies and new emerging tech-
SUSTAINABILITY REPORT 2014 RESPONSIBLE BEHAVIOR VALUE CHAIN SUSTAINABILITY
nologies. Geological scarcity is likely to become an important deter- mining factor over the long term for some precious raw materials.
To minimize risks related to environmental, social and supply vul- nerability, the Volvo Group strives to reduce the quantity of critical and scarce materials in our products.
Greater fuel efficiency by design
The Volvo Group believes we will contribute more to environmental sustainability by reducing the environmental impact of our products during the use phase, which results in a priority for product develop- ment to focus on fuel efficiency and emissions.
Renault Trucks has calculated that the fuel consumption of a typ- ical long-haul truck has been reduced by around 30% over the past 30 years. Today, a truck that meets the Euro 6 standard can con- sume up to 5% less fuel than the previous generation of heavy duty trucks. Additional fuel savings of up to 15% can be achieved by using Renault Trucks’ complete package of Optifuel solutions, including;
• Optimized drivelines and aerodynamic accessories • Training for drivers and supervisors in eco-driving
• Software to measure and analyze fuel consumption and lifecycle performance
• Servicing and maintenance checks using genuine spare parts, accessories, and eco-lubricants
Read more about the Volvo Group’s development of fuel efficiency solutions on page 22.
REDUCING EMISSIONS FROM OUR PRODUCTS
Over the past two decades, a significant proportion of the Volvo Group’s investment has been allocated to product development to ensure compliance with increasingly stringent emissions regulations. Emissions of pollutants
Governmental regulations have focused primarily on reducing the emissions of pollutants, such as nitrogen oxides (NOx) and particu- late matter (PM). Hydrocarbons
HC
−95%
Particulate matterPM
−97% −98%
Nitrogenous oxidesNO
X−89%
Carbon monoxideCO
• EU: adherence to the Euro anti-pollution standards for heavy commercial vehicle engines has seen the level of emissions from a truck being considerably reduced between 1990, the year of the first Euro 0 standard, and 2014 when Euro 6 came into force, as shown in the illustration. The Volvo Group has a complete Euro 6 engine program ranging from the smallest medium-duty 5-liter engine to the heavy-duty 16-liter version. Volvo Construction
Equipment and Volvo Penta were among the first to certify engines compliant with Stage IV in Europe and have reduced NOx emis- sions by 80%, compared to previous regulations.
• US: With the implementation of EPA 2010 in North America, emission levels for particulates and NOxfrom trucks are lowest they have ever been. Our Volvo and Mack-branded trucks are all certified in compliance. Volvo Construction Equipment and Volvo Penta were among the first to certify engines compliant with the Tier 4 final emissions regulation in the US. Volvo Penta has also finalized the introduction of engines compliant with the most strin- gent marine emissions regulation, EPA Tier 3.
Greenhouse gas emissions
Having reached these low levels of NOx and PM emissions, regula- tion and product development in this area is forecast to flatten in most regions. New trends in legislation are increasingly focusing on CO2 emissions that are a product of fuel consumption.
The Volvo Group is aligning its product development investment to take account of the following regulations.
• US: Starting with model year 2014, greenhouse gas emissions and fuel consumption have been regulated to target considerable improvements against a 2010 baseline. All of the Volvo Group’s truck models in the US are certified in accordance with the 2014 fuel efficiency and greenhouse gas regulations.
• EU: In May 2014, the European Commission presented a strategy for reducing CO2 emissions from heavy-duty vehicles (HDVs), which they calculate as representing about 25% of EU road trans- port carbon emissions. A computer simulation tool for calculating of CO2 emissions from new HDVs – VECTO – has been developed in collaboration with the Volvo Group and other manufacturers. The plan is to bring forward proposals for legislation during 2015 which would require CO2 emissions from new HDVs to be certified, reported and monitored. The overall EU target is for greenhouse gases to be reduced by a total of 20% between 2008 and 2030, and by at least 60% by 2050, with 1990 as the base year. The target for city transport is largely carbon-neutral logistics in major cities by 2030. The EU plans will require the transport sector to consider new vehicle technology, engines, materials and design, traffic planning and the use of purer forms of energy through new drivelines and alternative fuels. All of these are priority areas in the Volvo Group. Read more on page 22.
Limiting noise emissions
Noise is a growing problem in urban areas. The EU estimates that some 20% of its population suffers from noise levels that scientists and health experts consider unacceptable.
The Volvo Group is continuously working to measure noise and vibration characteristics in engine and driveline components. Sound engineers use both insulation and alternative design solutions to make everything from engines and transmissions to axles, fans and air intakes quieter.
However, at speeds above 50 km/h, noise created from the contact between tire and road is higher than noise emissions from the driveline. This means that effective control of road traffic noise requires a holistic approach with coordinated efforts between vehicle and tire manufac- turers, road builders and infrastructure architects.
Reduction of truck engine emission between 1990 (Euro 0) and 2014 (Euro 6)
SUSTAINABILITY REPORT 2014 RESPONSIBLE BEHAVIOR VALUE CHAIN SUSTAINABILITY