Mercedes-Benz Group AG, founded in 1926 and headquartered in Stuttgart, Germany, is one of the world’s leading manufacturers of premium and luxury passenger cars and vans, operating in over 100 countries with production facilities across Europe, North America, Latin America, and Asia. The company published its Annual Report 2024, including a full Sustainability Statement, on March 10, 2025, and its Climate Transition Action Plan 2025 shortly thereafter, both covering data for FY2024 and reporting under the EU Corporate Sustainability Reporting Directive (CSRD), GRI Standards, and the Science Based Targets initiative (SBTi). Ambition 2039, Mercedes-Benz’s overarching sustainability strategy, commits the company to net carbon neutrality across the entire vehicle lifecycle and value chain by 2039, 11 years ahead of EU legislative requirements.
Source
https://group.mercedes-benz.com/sustainability/sustainability-report.html
https://group.mercedes-benz.com/sustainability/environment-climate/decarbonisation/ambition-2039-our-path-to-co2-neutrality.html
https://www.automotiveworld.com/news-releases/mercedes-benz-reaffirms-its-commitment-to-sustainability-and-puts-ambitions-on-the-record/
https://esgnews.com/mercedes-benz-aligns-business-strategy-with-six-key-esg-focus-areas/
Sustainability Strategy and Goals
Mercedes-Benz structured its sustainability strategy around six formally defined ESG focus areas, presented in November 2024 as an integrated part of its business strategy: Environment and Climate, Resources and Circularity, Human Rights, Traffic Safety, Digital Trust, and People. The strategy aligns with the UN SDGs, particularly SDG 7 (Affordable and Clean Energy), SDG 12 (Responsible Consumption), SDG 13 (Climate Action), and SDG 15 (Life on Land), and is verified annually against SBTi, GRI, and CSRD requirements. Ambition 2039 ties each of the six focus areas to a specific 2039 endpoint: net carbon-neutral fleet lifecycle, closed material cycles, fully assessed critical raw material supply chains, zero-fatality ambition, trusted data use, and just transition for employees and communities.
Net Zero and Carbon Emissions
Mercedes-Benz Group reported total GHG emissions in 2024 of approximately 129.6 billion kg CO2e, comprising Scope 1 of 600,000 tCO2e, Scope 2 of 1,000,000 tCO2e (location-based), and Scope 3 of approximately 128.9 billion kg CO2e, with use of sold products contributing approximately 97 billion kg CO2e of the Scope 3 total. The company’s 2030 targets are an 80% reduction in Scope 1 and 2 emissions from the 2018 baseline, with milestone targets of 70% renewable energy coverage for Cars and 80% for Vans by 2030. Net carbon-neutral production across all fully owned plants has been achieved since 2022 and confirmed through 2024, covering Scope 1 and 2 at production sites.
- Scope 1 emissions (2024): 600,000 tCO2e
- Scope 2 emissions (2024): 1,000,000 tCO2e (location-based)
- Scope 3 emissions (2024): approximately 128.9 billion kg CO2e; use-phase: approximately 97 billion kg CO2e
- Total GHG emissions (2024): approximately 129.6 billion kg CO2e
- 2030 Scope 1 and 2 target: 80% reduction from 2018 baseline
- Production CO2 end-of-decade target: 80% reduction from 2019 baseline
- Net carbon-neutral production (all fully owned plants): achieved from 2022, confirmed through 2024
- Ambition 2039: net carbon-neutral fleet and value chain (Scope 1, 2, and 3) by 2039
Water Stewardship
Mercedes-Benz integrates water stewardship into its production site environmental management systems and applies formal water reduction measures at all plants, particularly in water-stressed regions. The company’s Responsible Sourcing Standards (RSS) require suppliers to comply with minimum requirements on water management as part of the environmental due diligence, deforestation, and biodiversity provisions embedded in all supply contracts. Specific global water consumption volumes by year are not separately highlighted in the 2024 Climate Transition Action Plan summary, though the company confirms that production waste for disposal has been cut to 250g per vehicle at European plants as part of its broader resource efficiency program.
- Water management: embedded in production site environmental management systems globally
- RSS water requirements: suppliers contractually required to comply with water environmental due diligence
- European plant waste for disposal: 250g per vehicle (2024); 38% waste reduction vs 2023
- Site-level ISO 14001 certification: in place across production facilities
- Group-wide water consumption reduction target: not separately published in 2024 Climate Transition Action Plan
Regenerative Agriculture
Mercedes-Benz has no direct agricultural supply chain. Its closest equivalent program is the Corridor initiative, launched at Climate Week New York in September 2024 in partnership with Norwegian aluminum producer Hydro, aimed at protecting biodiversity and supporting sustainable livelihoods in the Amazon. The Corridor program, developed with Brazilian NGOs IPAM, Imazon, and CEA, and with Boston Consulting Group, targets deforestation reduction, nature regeneration, low-carbon value chain development, and income generation for local Amazon communities. The program directly connects Mercedes-Benz’s aluminum procurement to upstream land stewardship in a biodiversity-critical region.
- Corridor program (September 2024): partnership with Hydro, IPAM, Imazon, CEA, BCG for Amazon biodiversity and community development
- Corridor targets: deforestation reduction, nature regeneration, low-carbon value chains, indigenous community income
- Responsible Sourcing Standards: include explicit biodiversity and deforestation requirements for all supply chain partners
- Dedicated regenerative agriculture program: not applicable; Corridor program is the closest parallel
Deforestation and Biodiversity
Mercedes-Benz has published a general commitment to “Deforestation-Free Supply Chains” as a formal policy within its Responsible Sourcing Standards (RSS), which applies to all direct and indirect suppliers. The RSS includes explicit minimum requirements covering deforestation, biodiversity, and water in supplier contracts. The Corridor program with Hydro provides the most geographically specific biodiversity intervention, targeting Amazon ecosystem conservation tied to the aluminum supply chain.
- RSS deforestation-free supply chain commitment: formal policy, embedded in all supplier contracts
- RSS minimum requirements: include deforestation, biodiversity, and water environmental due diligence provisions
- Corridor program: Amazon biodiversity conservation tied to aluminum supply; launched September 2024 with Hydro and Brazilian NGOs
- Lead the Charge 2025 scorecard: Mercedes holds a general “Deforestation-Free Supply Chains” commitment but more granular, site-level deforestation verification metrics are not yet disclosed
Packaging and Circular Economy
Mercedes-Benz opened Europe’s first battery recycling plant using a combined mechanical-hydrometallurgical process in Kuppenheim, Germany, in October 2024, in which the company has invested tens of millions of euros. The Kuppenheim plant processes up to 2,755 tonnes of battery material annually and is expected to yield a recovery rate of over 96% for lithium, nickel, and cobalt, producing enough recovered materials to manufacture more than 50,000 new battery modules per year. The plant is supplied with 100% green electricity and its 6,800 square meter roof hosts a photovoltaic system with peak output of over 350 kW.
- Kuppenheim battery recycling plant: opened October 2024; Europe’s first mechanical-hydrometallurgical EV battery recycler
- Annual capacity: 2,500 to 2,755 tonnes of battery material
- Recovery rate target: over 96% for lithium, nickel, and cobalt
- Annual battery module output from recovered materials: 50,000+ new battery modules
- Plant energy: 100% green electricity; 350 kW+ photovoltaic system on roof
- European plant waste for disposal: cut to 250g per vehicle in 2024; 38% waste reduction vs 2023
- EU Battery Regulation alignment: 2026 recycled content labeling and 2027 QR code requirements actively planned for
Human Rights and Responsible Sourcing
Mercedes-Benz has identified 24 raw materials with increased human rights and environmental risks and committed to fully assessing all 24 by 2028. As of end 2024, 65% of this assessment is complete, exceeding its self-set annual target. New battery material suppliers are required to source cobalt, lithium, nickel, natural graphite, and manganese from mines audited by the Initiative for Responsible Mining Assurance (IRMA) as a mandatory contractual condition.
- Critical raw materials under human rights and environmental assessment: 24 identified
- Assessment completion by end 2024: 65%, exceeding the annual target
- Full assessment target: all 24 materials by 2028
- IRMA audit requirement: mandatory for all new battery material suppliers for Co, Li, Ni, natural graphite, Mn
- Raw Material Report 2024: published, covering 15+ raw materials with sourcing transparency data
- Germany Supply Chain Due Diligence Act (LkSG) compliance: active since 2023; RSS requirements exceed LkSG minimum standards
- Cross-company grievance mechanism: launched in Mexico in 2024 to address systemic supply chain human rights risks
Nutrition and Health
Mercedes-Benz’s product portfolio is confined to premium and luxury passenger cars and vans, with no intersection with nutrition or food systems. Its contribution to public health is tied to zero-tailpipe-emission BEV production and to Traffic Safety, which is one of its six formal ESG focus areas targeting a zero-fatality ambition. The company also runs a “Just Transition” program, which addresses the health, welfare, and livelihoods of workers and communities affected by the decarbonization transformation across its value chain.
- Traffic Safety: formal ESG focus area; zero-fatality ambition as long-term goal
- Just Transition program: covers workforce welfare during electrification and plant transformation
- BEV tailpipe emissions: 0g CO2/km at point of use across all fully electric models
- Dedicated nutrition strategy: not applicable
Community and Social Impact
Mercedes-Benz employs approximately 166,000 people globally and operates a formal Just Transition program as an integral part of its decarbonization strategy, ensuring that workforce transformation caused by electrification is managed with social responsibility. The Corridor program in the Amazon directly benefits indigenous communities and smallholder landholders in Brazil through income generation, low-carbon value chain development, and nature restoration. Mercedes-Benz’s community investment programs at production sites in Germany, the US, South Africa, India, and China are aligned with its People focus area under the six ESG pillars.
- Global workforce: approximately 166,000 employees
- Just Transition program: formal policy covering workforce impact during decarbonization
- Corridor program community benefit: income generation and land rights protection for Amazon communities
- Cross-company grievance mechanism: launched in Mexico in 2024, open to supply chain workers
- People: one of six formal ESG focus areas in Mercedes-Benz’s sustainability strategy
Governance and Transparency
Mercedes-Benz reports under CSRD, GRI Standards, SBTi, and the UN Global Compact, and published its Climate Transition Action Plan 2025 alongside its Annual Report 2024 in March 2025. The company achieved a CDP A rating in 2024 and holds MSCI ESG ratings aligned with its Ambition 2039 commitments. Six ESG focus areas, formally embedded in the business strategy and announced in November 2024, are each assigned a board-level owner and reported against in the Annual Report and Sustainability Statement.
- CSRD, GRI, SBTi, UNGC: all active reporting frameworks
- CDP rating: A in 2024
- Six ESG focus areas: formally integrated into business strategy (November 2024)
- Climate Transition Action Plan 2025: published March 2025 alongside Annual Report 2024
- Board-level ownership: each ESG focus area assigned to a board member
Technology and Innovation
The Kuppenheim battery recycling plant, opened October 2024, is the centrepiece of Mercedes-Benz’s circular technology innovation portfolio and the first in Europe to combine mechanical and hydrometallurgical battery recycling in a single facility. The process recovers over 96% of lithium, nickel, and cobalt from end-of-life batteries and manufacturing scrap, producing battery-grade materials that feed directly into new Mercedes-Benz EV battery production. Mercedes-Benz also deployed renewable energy procurement at all its fully owned global plants from 2022, and is expanding onsite solar generation, wind energy procurement, and Power Purchase Agreements to cover 70% of Cars energy and 80% of Vans energy by 2030.
- Kuppenheim: Europe’s first mechanical-hydrometallurgical battery recycler; over 96% recovery of Li, Ni, Co; 2,500+ tonnes/year; 100% green electricity supplied
- Net carbon-neutral production since 2022: 100% renewable electricity at all fully owned plants; confirmed through 2024
- Corridor program (2024): Hydro partnership linking aluminum procurement to Amazon biodiversity and low-carbon value chain development
- xEV portfolio expansion: targeting up to 50% xEV share (BEV + PHEV) in new vehicle fleet in the second half of the decade
- Logistics decarbonization: targeting 60% CO2 reduction by 2039 vs 2021 baseline; on track per March 2025 reaffirmation
Global Partnerships and Advocacy
Mercedes-Benz is a member of IRMA (Initiative for Responsible Mining Assurance), the Responsible Minerals Initiative (RMI), and the Global Battery Alliance (GBA) Battery Passport program, connecting its supply chain commitments to globally verified ethical sourcing and traceability standards. The Corridor program with Hydro, IPAM, Imazon, CEA, and Boston Consulting Group, launched at Climate Week New York in September 2024, represents the company’s highest-profile Nature-based Solutions and biodiversity partnership. Mercedes-Benz reports formally under CSRD, aligns with the EU Battery Regulation, and participates in the UN Global Compact’s Ten Principles framework.
- IRMA membership: mandatory for new battery suppliers from 2024
- Global Battery Alliance Battery Passport: participant
- Corridor program (September 2024): Amazon biodiversity and community partnership with Hydro, BCG, IPAM, Imazon, CEA
- EU Battery Regulation compliance: preparing for 2026 recycled content labeling and 2027 QR code requirements
- UN Global Compact: Ten Principles alignment confirmed
- Germany LkSG compliance: active since 2023
Source
https://group.mercedes-benz.com/sustainability/environment-climate/decarbonisation/ambition-2039-our-path-to-co2-neutrality.html
https://group.mercedes-benz.com/dokumente/investoren/berichte/geschaeftsberichte/mercedes-benz/mercedes-benz-ir-climate-policy-report-2024.pdf
https://group.mercedes-benz.com/documents/investors/reports/annual-report/mercedes-benz/mercedes-benz-climate-transition-action-plan-2025.pdf
https://esgnews.com/mercedes-benz-aligns-business-strategy-with-six-key-esg-focus-areas/
https://www.automotiveworld.com/news-releases/mercedes-benz-presents-six-sustainability-focus-areas/
https://www.automotiveworld.com/news-releases/mercedes-benz-reaffirms-its-commitment-to-sustainability-and-puts-ambitions-on-the-record/
https://www.supplychaindive.com/news/mercedes-benz-circularity-germany-battery-recycling/731611/
https://group.mercedes-benz.com/company/news/recycling-factory-kuppenheim.html
https://www.hydro.com/en/global/media/news/2024/hydro-and-mercedes-benz-launch-partnership-to-foster-sustainable-development-in-the-amazon/
https://leadthecharge.org/wp-content/uploads/2025/02/Lead-the-Charge-_-Auto-supply-chain-leaderboard-2025-Mercedes.pdf
https://group.mercedes-benz.com/dokumente/nachhaltigkeit/produktion/mercedes-benz-raw-material-report.pdf
https://emobilityplus.com/2025/03/31/mercedes-benz-advances-sustainability-goals-with-significant-progress-in-electric-mobility-and-sustainability/
https://tracenable.com/company/mercedes-benz-group/ghg-emissions
https://www.lombardodier.com/insights/2025/may/driving-change-inside-mercedes-benz-s.html
Progress vs. Target Tracker
Source
https://group.mercedes-benz.com/dokumente/investoren/berichte/geschaeftsberichte/mercedes-benz/mercedes-benz-ir-climate-policy-report-2024.pdf
https://tracenable.com/company/mercedes-benz-group/ghg-emissions
https://emobilityplus.com/2025/03/31/mercedes-benz-advances-sustainability-goals-with-significant-progress-in-electric-mobility-and-sustainability/
https://leadthecharge.org/wp-content/uploads/2025/02/Lead-the-Charge-_-Auto-supply-chain-leaderboard-2025-Mercedes.pdf
https://group.mercedes-benz.com/documents/investors/reports/annual-report/mercedes-benz/mercedes-benz-climate-transition-action-plan-2025.pdf
Key Sustainability Innovations and Technologies
Mercedes-Benz’s sustainability innovation portfolio is anchored in three structural programs: Ambition 2039 for whole-lifecycle decarbonization, Kuppenheim for closed-loop battery materials recovery, and the Corridor program for upstream nature-linked supply chain stewardship. Together, these programs cover the three most carbon-intensive phases of vehicle lifecycle: production, battery materials, and use phase, making Mercedes-Benz’s innovation architecture one of the most lifecycle-complete in the European premium automotive sector.
- Kuppenheim battery recycling plant (October 2024): Europe’s first combined mechanical-hydrometallurgical EV battery recycler; annual capacity of 2,500 to 2,755 tonnes; over 96% recovery rate for lithium, nickel, and cobalt; produces enough recovered materials for 50,000+ new battery modules per year; powered by 100% green electricity with 350 kW+ rooftop PV; invested tens of millions of euros; technology partner Primobius (SMS Group and Neometals joint venture)
- Net carbon-neutral production since 2022: 100% renewable electricity at all fully owned global production plants, achieved three years ahead of the 2025 milestone target; the most advanced production-level decarbonization record of the three major German premium carmakers
- Corridor program (September 2024): strategic partnership with Hydro, BCG, IPAM, Imazon, and CEA targeting deforestation reduction, biodiversity conservation, community income generation, and low-carbon value chain development in the Amazon, directly linked to Mercedes-Benz’s aluminum supply chain
- IRMA mandatory sourcing for battery materials (2024): new suppliers of cobalt, lithium, nickel, natural graphite, and manganese must source from IRMA-audited mines; combined with the Raw Material Report (15+ materials disclosed) and the GBA Battery Passport program, this forms the deepest supply chain traceability architecture among mainstream European carmakers
- xEV fleet electrification: targeting up to 50% xEV share in new vehicle sales in the second half of the decade; Scope 3 use-phase emissions at approximately 97 billion kg CO2e in 2024 represent the dominant decarbonization lever; electrification directly compresses this figure as the fleet turns over
Source
https://group.mercedes-benz.com/company/news/recycling-factory-kuppenheim.html
https://www.supplychaindive.com/news/mercedes-benz-circularity-germany-battery-recycling/731611/
https://www.hydro.com/en/global/media/news/2024/hydro-and-mercedes-benz-launch-partnership-to-foster-sustainable-development-in-the-amazon/
https://group.mercedes-benz.com/sustainability/environment-climate/decarbonisation/ambition-2039-our-path-to-co2-neutrality.html
https://www.lombardodier.com/insights/2025/may/driving-change-inside-mercedes-benz-s.html
https://www.businesswire.com/news/home/20241021402777/en/Mercedes-Benz-opens-own-recycling-factory-to-close-the-battery-loop
Measurable Impacts
Mercedes-Benz’s Annual Report 2024, Climate Transition Action Plan 2025, and subsequent disclosures through March 2026 provide the most complete picture of the company’s sustainability performance.
- Total GHG emissions 2024: approximately 129.6 billion kg CO2e
- Scope 1 emissions 2024: 600,000 tCO2e
- Scope 2 emissions 2024: 1,000,000 tCO2e (location-based)
- Scope 3 emissions 2024: approximately 128.9 billion kg CO2e, with use of sold products at approximately 97 billion kg CO2e
- Net carbon-neutral production: all fully owned plants since 2022, confirmed through 2024
- Kuppenheim battery recycling plant: opened October 2024; 2,500 to 2,755 tonnes/year capacity; over 96% recovery rate
- Kuppenheim output: 50,000+ new battery modules producible from recovered materials annually
- European plant waste for disposal: 250g per vehicle in 2024; 38% reduction vs 2023
- Critical raw material human rights assessment: 65% complete as of end 2024, exceeding annual target
- CDP rating 2024: A
- 24 critical raw materials with human rights and environmental risks identified and under assessment
- IRMA mandatory sourcing: required for all new battery material suppliers from 2024
- Corridor program: launched September 2024 with Hydro, BCG, IPAM, Imazon, CEA
- Logistics CO2 reduction: on track for 60% by 2039 vs 2021 baseline
Source
https://tracenable.com/company/mercedes-benz-group/ghg-emissions
https://group.mercedes-benz.com/dokumente/investoren/berichte/geschaeftsberichte/mercedes-benz/mercedes-benz-ir-climate-policy-report-2024.pdf
https://group.mercedes-benz.com/company/news/recycling-factory-kuppenheim.html
https://emobilityplus.com/2025/03/31/mercedes-benz-advances-sustainability-goals-with-significant-progress-in-electric-mobility-and-sustainability/
https://group.mercedes-benz.com/documents/investors/reports/annual-report/mercedes-benz/mercedes-benz-climate-transition-action-plan-2025.pdf
Challenges and Areas for Improvement
Mercedes-Benz’s most significant sustainability challenge in 2024 and 2025 is the slower-than-projected ramp-up of BEV sales, which directly limits the pace at which Scope 3 use-phase emissions (approximately 97 billion kg CO2e in 2024) can be reduced. The annual report acknowledges that the electromobility transition is slower than planned, with the 50% xEV target for the second half of the decade now facing a more difficult market environment in China and Europe.
- xEV sales ramp-up: slower than projected in 2024; 50% xEV share target for second half of decade at risk
- Scope 3 use-phase emissions: approximately 97 billion kg CO2e in 2024, representing 74.8% of total group GHG footprint; reduction is directly dependent on BEV adoption rate
- Water consumption target: no group-wide quantified water reduction target or consumption total published in 2024 disclosures
- Deforestation-free supply chain: general commitment published in RSS but no verified site-level metrics disclosed as of the Lead the Charge 2025 scorecard
- Kuppenheim scale: 2,500 tonnes/year is a pilot scale relative to the volume of batteries in Mercedes-Benz’s growing EV fleet; commercial-scale expansion timeline has not been published
- Net carbon-neutral production reliance on offsets: like Audi, Mercedes-Benz’s net carbon-neutral production designation includes certified carbon offset projects for residual emissions that cannot yet be fully eliminated; the proportion covered by offsets vs eliminated emissions is not separately disclosed in public summaries
- Lead the Charge supply chain score: deforestation-free supply chain commitment exists at policy level but granular, verified supplier-level metrics are absent
Source
https://group.mercedes-benz.com/documents/investors/reports/annual-report/mercedes-benz/mercedes-benz-climate-transition-action-plan-2025.pdf
https://tracenable.com/company/mercedes-benz-group/ghg-emissions
https://leadthecharge.org/wp-content/uploads/2025/02/Lead-the-Charge-_-Auto-supply-chain-leaderboard-2025-Mercedes.pdf
https://group.mercedes-benz.com/sustainability/environment-climate/decarbonisation/ambition-2039-our-path-to-co2-neutrality.html
https://group.mercedes-benz.com/company/news/recycling-factory-kuppenheim.html
Future Plans and Long-Term Goals
Mercedes-Benz’s published 2025 to 2039 commitments form one of the most specific long-term ESG roadmaps in the European automotive sector, anchored by Ambition 2039.
- Scope 1 and 2: 80% reduction by 2030 from 2018 baseline
- Production CO2: 80% reduction by end of decade from 2019 baseline
- Renewable energy (Cars): 70% by 2030; 100% by 2039
- Renewable energy (Vans): 80% by 2030; 100% by 2039
- Net carbon-neutral fleet and value chain (Scope 1, 2, and 3): 2039
- Production materials procurement with neutral CO2 balance: 2039
- Critical raw materials fully assessed (all 24): 2028
- Raw Material Report 2025: 70% of 24 critical raw materials assessed and published, up from 65% in 2024
- Logistics CO2 reduction: 60% by 2039 vs 2021 baseline
- Kuppenheim battery recycling: medium to long-term scale-up of capacity beyond the 2,500 tonne initial phase
- xEV share: up to 50% of new vehicle sales in the second half of the decade
- Corridor program: scale biodiversity and community impact in the Amazon, with ambition to regenerate forest and generate income for local communities over the long term
Relative to Audi and BMW, Mercedes-Benz leads on Scope 3 disclosure depth (12 of 15 GHG Protocol categories, 128.9 billion kg CO2e disclosed) and on the most specific supply chain net zero year (2039 for all production material procurement). It also leads on battery circular economy infrastructure, with the Kuppenheim plant operational while competitors are still in pilot or planning stages. The BEV sales pace remains the single most critical variable in whether Ambition 2039 remains on schedule.
Source
https://group.mercedes-benz.com/sustainability/environment-climate/decarbonisation/ambition-2039-our-path-to-co2-neutrality.html
https://group.mercedes-benz.com/documents/investors/reports/annual-report/mercedes-benz/mercedes-benz-climate-transition-action-plan-2025.pdf
https://group.mercedes-benz.com/dokumente/investoren/berichte/geschaeftsberichte/mercedes-benz/mercedes-benz-ir-climate-policy-report-2024.pdf
https://group.mercedes-benz.com/company/news/recycling-factory-kuppenheim.html
https://www.hydro.com/en/global/media/news/2024/hydro-and-mercedes-benz-launch-partnership-to-foster-sustainable-development-in-the-amazon/
Comparisons to Industry Competitors
Mercedes-Benz is compared below against Audi AG and BMW Group, the two most directly comparable European premium carmakers with published and verifiable 2024 ESG data.
Mercedes-Benz leads the comparison on Scope 3 disclosure depth and specificity, the nearest-term whole-lifecycle net zero year (2039 vs Audi’s 2050 and BMW’s 2050), and operational battery circular economy infrastructure via Kuppenheim. BMW leads on renewable energy share at 51.5% of total energy and holds the highest MSCI ESG rating. Audi leads on ISS ESG industry ranking (B– across all automotive) and achieved the production net carbon-neutrality milestone in 2025, matching Mercedes-Benz’s 2022 achievement with a three-year lag.
Source
https://www.bmwgroup.com/content/dam/grpw/websites/bmwgroup_com/ir/downloads/en/2025/bericht/ESG_Overview_FY-2024.pdf
https://esgnews.com/audi-tops-esg-ratings-among-car-manufacturers-with-industry-leading-score-from-iss-esg/
https://tracenable.com/company/mercedes-benz-group/ghg-emissions
https://group.mercedes-benz.com/sustainability/environment-climate/decarbonisation/ambition-2039-our-path-to-co2-neutrality.html
What to Watch: 12 to 18 Month Indicators
Three signals will most clearly indicate whether Mercedes-Benz’s sustainability standing shifts materially over the next 12 to 18 months.
First: BEV and xEV sales trajectory in 2025 against the 50% second-half-of-decade target. The 2024 Annual Report explicitly acknowledged a slower-than-expected electromobility ramp-up in China and Europe. Scope 3 use-phase emissions at approximately 97 billion kg CO2e in 2024 represent 74.8% of total group emissions and can only be reduced through fleet electrification. Any 2025 full-year results showing year-on-year BEV sales growth above 20% would confirm the trajectory is recovering. A second consecutive year of subdued BEV growth would place the 50% xEV share target at significant risk and raise material questions about the credibility of the 2039 Scope 3 neutrality commitment.
Second: Kuppenheim battery recycling plant scale-up announcement. The Kuppenheim facility opened in October 2024 at an annual capacity of 2,500 to 2,755 tonnes, designed as a pilot to develop process knowledge that “could help scale up production volumes in the medium to long term”. A confirmed expansion investment, a second facility announcement, or a published commercial-scale capacity target for 2027 to 2030 would demonstrate that Kuppenheim is a circular economy platform rather than a flagship pilot. Without a scaling commitment, the plant’s contribution to Mercedes-Benz’s 2039 materials neutrality target remains symbolic relative to the volume of batteries in its growing EV fleet.
Third: Raw Material Report 2025 and 70% critical material assessment completion. Mercedes-Benz committed to assessing 70% of its 24 critical raw materials by end of 2025, up from 65% at end of 2024, and to publishing the findings in its Raw Material Report 2025. Delivery of this report on schedule with verified assessments covering the additional materials, and specifically the publication of community-level and mine-level findings for cobalt, lithium, and nickel, would confirm that Mercedes-Benz’s supply chain human rights program is advancing at pace. Any delay or coverage shortfall below 70% would undercut its lead position on supply chain transparency relative to Audi and BMW.
Source
https://group.mercedes-benz.com/documents/investors/reports/annual-report/mercedes-benz/mercedes-benz-climate-transition-action-plan-2025.pdf
https://group.mercedes-benz.com/company/news/recycling-factory-kuppenheim.html
https://group.mercedes-benz.com/dokumente/nachhaltigkeit/produktion/mercedes-benz-raw-material-report.pdf
https://tracenable.com/company/mercedes-benz-group/ghg-emissions
https://emobilityplus.com/2025/03/31/mercedes-benz-advances-sustainability-goals-with-significant-progress-in-electric-mobility-and-sustainability/
Mercedes-Benz enters 2025 and 2026 as the European premium carmaker with the most specific whole-lifecycle net zero year on record (2039), the deepest published Scope 3 dataset (128.9 billion kg CO2e across 12 GHG Protocol categories), and the only operational battery recycling facility in Europe using a combined mechanical-hydrometallurgical process. These three assets place it materially ahead of Audi and BMW on both disclosure maturity and circular economy infrastructure. The CDP A rating, IRMA mandatory sourcing for battery materials, and the Corridor program in the Amazon add supply chain and biodiversity credibility that few global automakers can match.
The core strategic risk is execution pace on BEV adoption. Ambition 2039 is mathematically dependent on fleet electrification reducing Scope 3 use-phase emissions, which are currently approximately 97 billion kg CO2e and represent 74.8% of total group GHG. If the global BEV ramp-up remains subdued through 2026, Mercedes-Benz will need to either accelerate fleet electrification materially, revise its 2039 timeline, or increase its reliance on supply chain carbon removal and offsets to compensate for slower use-phase emission reductions. The 2025 full-year delivery results, expected early 2026, will be the first meaningful indicator of which of these scenarios is unfolding.
The three strategic takeaways for practitioners benchmarking or replicating this approach are:
- Scope 3 disclosure as a competitive differentiator: Mercedes-Benz’s publication of 128.9 billion kg CO2e across 12 GHG Protocol Scope 3 categories, with specific use-phase disaggregation, is the most complete Scope 3 dataset among German premium carmakers. For ESG leaders designing disclosure programs, this level of Scope 3 granularity has moved from a leading practice to an emerging baseline expectation under CSRD and SBTi, and Mercedes-Benz’s architecture offers a practical template.
- The Kuppenheim plant as a circular economy architectural model: the combination of a mechanical front-end and a hydrometallurgical back-end in a single facility, powered by 100% green electricity, with recovered materials feeding directly back into new battery production, is the most complete circular battery economy model in operation in Europe. Practitioners designing battery circularity programs should study this process architecture as a scalable template rather than waiting for the next generation of direct recycling technologies.
- Supply chain transparency requires mandatory standards, not voluntary reporting: Mercedes-Benz’s requirement that all new battery material suppliers source from IRMA-audited mines, combined with 65% completion of human rights assessments for 24 critical raw materials and a cross-company grievance mechanism in Mexico, represents the deepest binding supply chain accountability framework in the German premium automotive sector. The strategic lesson is that voluntary reporting frameworks are insufficient for critical mineral supply chains; mandatory contractual requirements tied to specific audit standards are the minimum credible governance instrument.
Source
https://group.mercedes-benz.com/sustainability/environment-climate/decarbonisation/ambition-2039-our-path-to-co2-neutrality.html
https://tracenable.com/company/mercedes-benz-group/ghg-emissions
https://group.mercedes-benz.com/company/news/recycling-factory-kuppenheim.html
https://www.lombardodier.com/insights/2025/may/driving-change-inside-mercedes-benz-s.html
https://group.mercedes-benz.com/documents/investors/reports/annual-report/mercedes-benz/mercedes-benz-climate-transition-action-plan-2025.pdf
