Last year was a good one for Jaguar Land Rover. Our sales, our profits and our employment were all at record levels.
But one of my proudest moments had nothing to do with our profitability, or with selling cars. It was when, in July last year, we won Responsible Business of the Year from Business in the Community. Picking up that award, at the Royal Albert Hall in London in front of 1000 people, will live with me forever.
It proved we don’t just have a successful business. We have a responsible business, something that gives me even more pride. For that, I need to thank our employees and our suppliers. I also feel I have accepted this award on behalf of engineering and manufacturing in the UK, segments that have had a difficult time in the past decade or so.
As I have said many times, our company’s prosperity and this country’s prosperity are intrinsically linked to the health of the engineering and manufacturing sectors. Successful rich countries must invent and make things. The more inventive, the more innovative we are, then the more successful we will become.
We are on the verge of a new Industrial Revolution, which profoundly affects our business. The car industry is a very high-tech sector – after all, we make the most technically complex of all consumer products. And it is changing so fast! Who would have thought, just a few years ago, that zero emissions, zero accidents, and safer self-driving cars would all be priorities?
Changing faster, and listening to our customers better is how we will prosper. Also, we need to engage better with Generation Y – those under 30 who are our future customers and are keen to make the world a better place. So it is clear that environmental and social responsibilities are both key to our future success. Increasingly, customers will look to environmental and social performance when they choose the brands they wish to be associated with.
That is another reason why JLR was so pleased to win Responsible Business of the Year just six months ago. A company selling mostly SUVs would have been an unlikely winner of this award a few years ago.
We are, it is clear, getting recognition for our progress. We have launched a new smaller and more fuel efficient Range Rover. Plus – the world’s first premium SUV using a lightweight aluminium body.
We have unveiled the world’s first diesel hybrid luxury SUV. We have cut our fleet average tailpipe CO2 by 23 per cent over five years and – over the same time period – reduced waste to landfill by 75 per cent, and our manufacturing carbon footprint by 21 per cent.
We have achieved a lot partly because we have challenged ourselves like never before. A good example of this is our new Jaguar C-X75 concept car, on display here today. It mixes the performance and looks of the fastest-ever Jaguars with transformational fuel economy and CO2 emissions. A few years ago this car would have been technically impossible. Do speak to our apprentices, here with me today, to find out more.
I think our award also reflects our educational initiatives, which we call Inspiring Tomorrow’s Engineers. We recognise the chronic skills gap in science and engineering that exists in the UK. We now reach out to 200,000 schoolchildren every year to attract them to careers in engineering. We don’t just do this out of philanthropy. We do it because without a new generation of engineers we would cease to innovate as a company.
Ladies and gentlemen, Marc Bolland, CEO of the 2012 Responsible Business of the Year winner Marks and Spencer challenged us to leave a strong legacy and kindly said that our win was a ‘potentially defining force in bringing about a transformative change in the luxury goods industry’.
Our goal is to build a meaningful legacy. Today, I would like to give some insights into how we will start the next phase of our responsible business journey.
First, it is about engaging the customer with our environmental initiatives. We will continue to drive innovation in our vehicles to reduce CO2 emissions thanks to more efficient engines to be built at our new factory in Wolverhampton, hybrids, lightweight materials and other new technologies.
But 80 per cent of the environmental impact of our vehicles is in the ‘in-use’ phase. To make a big difference, we need to get our customers on board. We will launch a partnership with our customers to encourage them to drive more economically, reducing their eco footprint and saving them money.
We will invest the eco-savings from more efficient driving to deliver good elsewhere – for example improved healthcare and better education for disadvantaged communities with our charity partners.
Our marketing people are responding to the challenge of making sustainability desirable. We will of course share our experiences through our chairmanship of the Marketplace Sustainability Leadership team, to inspire other BITC members.
Next – we will take our educational programmes to a new level. We recently launched a special enhanced traineeship programme aimed at 16-23 year olds who are unemployed, or not in education or training – including those who missed out on our apprenticeship programme. We will take 150 trainees who are interested in automotive careers through this programme by July. Those who successfully complete it will be offered interviews with JLR or with our suppliers.
The goal is to offer employment and to unlock the potential of these young people. It is our own small contribution towards tackling the huge social problem of youth unemployment.
Next – we will collaborate even more closely with our suppliers, to further improve our resource management – reducing both our costs and our environmental impact. For example, our use of recycled aluminium in our lightweight bodies saves on material costs and uses 95 per cent less energy to process than virgin aluminium. We will share our latest research into extending recycled aluminium from 50 to 75 per cent with our top 200 suppliers this April.
The goal is to apply similar thinking to our other priority commodities – leather, carbon fibre, plastics and magnesium. We want best practices to spread across the whole supply chain to extend the financial and environmental benefits of ‘closed loop’ or ‘circular economy’ thinking.
Of course, we all need to work together to ensure a better future. As part of Business In the Community’s Seeing is Believing programme we will be hosting a visit to JLR’s plant at Castle Bromwich in Birmingham on May 7. You can see, firsthand, how business can help communities and make a positive change through education partnerships. You will also see our industry-leading lightweight aluminium technologies and our ‘closed loop’ environmental processes in action.
Additionally, I’d like to invite some of you to two innovation days at our Gaydon product creation facility and test track, to sample game-changing new vehicles such as our new Range Rover hybrid and learn more about our C-X75 innovation story.
We will also share our experiences, successes and, yes, failures, in our three legacy programmes – Future Driven – with BITC and member companies. This starts at Responsible Business Week in a couple of months’ time.
Ladies and gentlemen, as I hope I’ve made clear – we were honoured and humbled to be awarded Responsible Business of the Year. I believe – and I know Marc Bolland agrees – that we won partly because of our potential to do something really special. There are high expectations.
Delivering a truly sustainable business is an immense challenge. We’re up for it. No one company has all the answers. We certainly don’t. So we look forward to sharing our experiences and working with BITC and the many companies in this room to make this a reality.