Engineering Envrionmentally Friendly Design with Ford’s John Viera

August 9, 2013

JOHN SHEGERIAN: Welcome back to Green is Good, and we’re so excited and honored to have John Viera with us on Green is Good today. He’s the Global Director in Sustainability and Vehicle Environmental Matters for Ford Motor Company. Yes, Ford is on the show today. John Viera’s in the house. Welcome to Green is Good. JOHN VIERA: Thank you, John. It’s great to be here. Really appreciate you having us. JOHN SHEGERIAN: Hey, you know, John, so many young people write to us on the show and they say, ‘How can I become the next John Viera?’ Can you share a little bit about your journey leading up to this important post that you have at Ford right now? JOHN VIERA: Yeah, sure can, John, because as you mentioned in my title, so I’m the global sustainability guy for Ford or the global green guy for Ford and if a lot of people do ask me, ‘How did you get in your position?’ and, ‘I like sustainability. What was your background?’ Well, actually John, my background, I hired into Ford 29 years ago so I’ve been here for a long time and it’s been a while but the cool things was I hired in as an engineer working on our cars and trucks and a product engineer, really got to know the ins and outs of designing all parts of the vehicle and it was a lot of fun from working on small cars to large trucks to electric vehicles and vehicles that run on natural gas so just a variety of different products and I just never realized, John, I’ve been in this position for about six years now, seven years, and I never realized that all of my experiences working on different parts of the vehicle actually were completely suitable for this job of now designing and putting strategies together to ensure that our vehicles are as environmentally friendly as possible. JOHN SHEGERIAN: That’s so great. That’s so exciting and really, truth be told, John, 10 years ago, people didn’t hold the roles. There was no such role of Chief Sustainability Officer or global green guy or Director of Sustainability of great companies, iconic brands like yours and now there is and that’s the great part. JOHN VIERA: Absolutely, John, and you’re right. Ten years ago, they didn’t exist and the real cool things is if it’s Ford Motor Company or any company, if that company wants to be more sustainable, it’s just not getting somebody who’s excited about using more sustainable materials or whatever. It’s really more about how within that company the operations, the work that’s being done on a day-to-day basis, how do those operations become more sustainable and if you come from within that company, you have that base knowledge to be able to translate that into how to become more sustainable. JOHN SHEGERIAN: That makes so much sense. Twenty-nine years, you already have the DNA and culture there so that makes all the sense in the world. That is so great and we’re so honored to have you on today, John, because it’s so important that our listeners out there get to hear the great things that Ford is doing and not enough of that out there, so we’re so thankful you’re here and we’re so thankful you’ve come on Green is Good. Talk a little bit about what’s going on at Ford. You started in this role in 2007. Talk a little bit about the evolution, starting in the role and evolving it over the last six years or so. How has that worked and what of you learned in the journey itself just in this role? JOHN VIERA: Yeah, absolutely, John, so when we talk about being the head sustainability guy at Ford, you first get into a role. The first question is what should we start working on? And if you go back 10 years ago or so, I think the view of the American auto companies in particular were that we didn’t focus enough on sustainability. We were all about large cars and large trucks and that’s not very sustainable so when I came on board and people asked the question, you guys really don’t have a very good record of being sustainable. I first came on and said look at all these great things we’re doing in manufacturing and we’re doing some of these things with materials and we have a lot of people going out and volunteering, everybody said that’s great but the main thing that you can do from a Ford perspective as it relates to the environment is to reduce the carbon dioxide coming from your tailpipe and what that means, John, is improving fuel economy because it’s a one to one relationship so the comment to me was we really want to see a plan from Ford that says from all of your vehicles from small cars to large trucks, that for every vehicle, you’re laser focused on absolutely doing the best you can in being leaders in fuel economy in all those different segments because then you will be leaders in reducing CO2 in all those different segments so that was my initial focus was putting together that product plan that really drove to the lowest levels of CO2 coming from our tailpipe over time. JOHN SHEGERIAN: And, how has that worked? Tell me where you started and how you’ve moved the needle in these years. JOHN VIERA: Well you know, where we started, it was kind of interesting. What we used to do, John, is we used to just follow regulations so many people are familiar with some of the fuel economy regulations that we have in the U.S. that are called CAFE or Corporate Average Fuel Economy and we used to be a company that said alright, when the regulations come out, we’ll try to figure out what kind of vehicles we need to design to meet those regulations and the issue with that, John, was that since the regulations were always changing, we were always having to tear up our plans and start over and we didn’t really have a focus on the environment. It was just about meeting the regulations. What we decided to do shortly after I came on board was that we moved to a model of saying wait a minute, we know that climate change is an issue. As a matter of fact, back in 2005, our Executive Chairman, which many people know, Bill Ford, who is also a Ford member, came out and said climate change is real. Ford needs to do its part in terms of addressing climate change so one of the things we did, John, is we said, okay, if we’re making that statement, what is it that we’re gonna do to address climate change? We’re fortunate to actually have climate scientists at Ford and they recognized the climate change issue and they said you know something, we know that in order for us to do our share in terms of limiting the negative impacts of climate change, we could actually set targets, John, today, five years from now, 10 years from now, 50 years from now, on what kind of emissions or carbon dioxide should be allowed to come from our vehicles and if we kind of set up that particular road map, we could understand the types of vehicles we should be producing today, five year from now, 10 years from now, 50 years from now, so that’s really what we put together. JOHN SHEGERIAN: Got it, and for our listeners out there who just joined us, we got John Viera on. He is in charge of sustainability and all things green at Ford Motor Company and to learn more about what Ford is doing and the great things they’re doing in green and technology, you can go to www.ford.com/green or /technology. I’m on the Ford website right now. I’m on the technology section. Let’s talk about your clients, your drivers. What are you doing to help with technology and the whole green revolution to make your driving experience more fun or more green for your clients, your constituency base? JOHN VIERA: Yeah, great question, John, so what we’re doing, I’m gonna focus on two things. The first element is for the vehicles that people can buy, one of the things that we wanted to do, we have this approach called Power of Choice and what Power of Choice means is that if a customer wants to be more responsible or drive a greener vehicle, we don’t say, ‘Hey, the only choice that you have is to buy this electric vehicle and if you don’t want to buy that electric vehicle, I guess you’re not buying a green vehicle.’ We said let’s give customers choices so it could be a pure battery electric vehicle. It could be a hybrid vehicle. It could be a vehicle running on natural gas. It could be just a highly fuel-efficient gasoline vehicles so every vehicle that we produce is leading in fuel economy in the segment that it’s in, but we also offer choice of customers to be able to buy electric vehicles so we’re giving them choices; not just buying one type of vehicle that meets their needs. That’s the first step, John. The second step is after they buy the vehicle, what kind of tools can we provide to customers to drive their vehicle more efficiently to be more green and in all of our vehicles, and I know our competitors have a lot of this as well, which is good news, we have this thing called instantaneous fuel economy, so it’s almost like a game where you can turn on this particular gauge and it tells you how you’re doing fuel economy wise as you’re driving the vehicle so it’s giving you real time feedback if you’re driving it efficiently or not so that provides some good feedback. The other thing that we provide to customers in our navigation system: You’re probably familiar with navigation systems that say, okay, I want to get to this restaurant over here and it tells you the quickest route to get to that restaurant. Well, in our navigation system, we also have a selection that tells you what’s the most fuel-efficient route to get to that destination so it might take you a little bit longer, John, but it’s basically taking you on roads at certain speeds that’s gonna get you there in the most fuel-efficient way, so again, just providing feedback. JOHN SHEGERIAN: And, does that change on a real-time basis based on traffic patterns, time of day and things of that such? JOHN VIERA: We’re getting to that point. So, right now, it’s mainly based upon the known speed limits of that area, so that’s a great questions because when you think about the technology, we do have in our navigation the ability to understand real time traffic to have you avoid certain routes if there’s an accident or construction. You should be in our research area, John. The next step is to combine the two of those so that’s you’re really getting as fuel efficient as possible. JOHN SHEGERIAN: Something to look forward to coming from Ford. We love it. So, John, now we talked about your constituents and the sales sides. Let’s now go backwards and let’s talk about the manufacturing side. What’s going on in your factories that you’ve touched on there and you’ve been able to influence there in terms of making your manufacturing more sustainable? JOHN VIERA: Absolutely, John, and I know you’ll appreciate this with the focus you have on your company and that’s waste, right, so we have a big focus on waste to landfill and so something that we’ve just declared recently this year is that we’re reducing the amount of waste going to landfill by 40% between 2011 and 2016 and that comes on top of a 40% reduction that we had from 2007 to 2011 so you can see that the intention here is to get to basically what we call zero waste to landfill, right? And, the way you do that isn’t just to say, John, hey, we’re gonna set this target of zero waste to landfill sometime in the next 20 years. You say that’s the ultimate goal but let’s have some very specific goals that we want to meet in defining time periods, five-year time periods, because then if you meet those, you’re really making progress to that ultimate goal. JOHN SHEGERIAN: That’s so true. John, you sit in a unique chair at Ford and you get to see macro everything from front to back at the company and what’s going on. What’s your top of mind? When it comes to sustainability, and you are always constantly, I’m sure, having to prioritize, reprioritize, juggle different priorities there with regards to hot spots. What’s your hot spot today? We’re in 2013. The green revolution has finally taken hold here in our great country and everybody seems to be into it, not only amazing and wonderful and iconic brands like Ford, but also just the consumers at large and everybody in between, so what’s your hot topic inside of Ford right now with regards to sustainability? JOHN VIERA: Actually, I think there’s two, John, if I could throw two of them out there. One of them’s kind of more near term and one of them’s a little bit longer term, so the nearer-term element is the way you get mainstream America to recognize and want to adopt kind of a sustainable lifestyle, you can’t just sell it on it’s good for the environment. It needs to make financial sense for people as well and I think our job as a technology company like Ford is to be able to produce products that not only are good for the environment but save people money so our big challenge right now, John, is as we talk about some of our advanced technology, so our fuel-efficient technologies, our technologies to go to more electrified vehicles, if it’s hybrids or battery electric-type vehicles, it does cost more money for those vehicles because we’re putting technology in and the thinking has always been as gasoline prices continue to rise that people will, like they’re doing in Europe, be willing to pay more money for more fuel-efficient vehicles because they get that money back because they’re not going to the gas station as much. One of the challenges that we’re seeing is gas prices, even though some of us might say they’re high, they’re still relatively affordable and they’re not expected to increase significantly moving forward so we have this challenge around we want to put a lot of technology in to make the vehicles more fuel efficient and bring out a lot of these advanced vehicles like electrics, which is raising the cost of the vehicles, but customers are sometimes challenged to pay that price because they’re saying gasoline is relatively inexpensive and maybe I don’t want to pay a lot more for a vehicle that has more technology. JOHN SHEGERIAN: Gotcha, gotcha. Go on. I’m sorry. JOHN VIERA: Then the other element, that’s the challenge is how do we make that affordability work for people with these great advanced technology? I think the other piece, John, which is really exciting moving forward if you want to talk about the macro is this topic called sustainable mobility so sustainable mobility is all about how do you move goods and people from point A to point B and we could put out the greatest electric vehicles and advanced technology vehicles ever. The problem is we’re running into a situation now where it’s pretty obvious in L.A. and many major cities throughout the country that we have a congestion problem, right? So, you could have a zero-emission, very clean vehicle, but the bottom line is if you can’t move around because there’s so much emission, that’s the big issue so we’re really looking at from a macro standpoint how do we think differently about moving goods and people from the traditional we’re just gonna build more and more vehicles because you get to this point where the congestion is so bad you have gridlock and that’s a real exciting area that we’re moving into. Maybe there’s other modes of transportation that we’re thinking about or linking into other modes of transportation or sharing transportation with other individuals. It’s all of those methods that we’re focused on as well. JOHN SHEGERIAN: You hit upon the issue of saving money, both for the consumer, but also for Ford. John, you’ve been now doing this long enough at Ford and there’s a lot of people out there that have much smaller companies but companies that are growing fast that want to green their companies and are daunted by the challenges and also anecdotally, the bad rap that being green or more sustainable has gotten is it’s more expensive. Had Ford saved money by being more responsible under your stewardship or does this cost Ford money? JOHN VIERA: Well actually, it does save money. There are elements that can definitely save money and I think my recommendation to any business would be when you think about environmental actions or certain actions that you could take that truly will cost money, rather than focusing on those, think about those actions that will save money and sometimes, John, those actions aren’t as sexy. They’re not necessarily putting in a wind turbine but it is things like I mentioned this reduction that we have in waste. Well, just in 2012, we generated 225 million in revenue from all of this waste that the scrap metal and everything that we’re reselling. Those are real dollars and that’s you’re being green. You’re generating revenue. Another element is water, for instance, so we have this big focus right now on reducing the amount of freshwater that we’re using in our facilities. Now that’s good for the environment, right? You’re using less water but the bottom line is if you’re using less water, you’re not paying for as much water so you’re actually having bottom line savings associated with water reduction, from an energy-efficiency standpoint. Those are green actions. Again, not as sexy. You’re changing the light bulbs. You’re saying, boy, I’m not getting a big splash, but I’ll tell you what. Over your entire operation, those types of actions get you immediate bottom line savings and what it does is it builds confidence within the company that you can be green and not have it cost you more and then you can tackle the more challenging, maybe the more expensive initiatives within the green area. JOHN SHEGERIAN: So, that’s easy. John just gave our listeners some quick wins to get in terms of waste reduction, in terms of water reduction, and if you’ve just joined us now, we’re so honored to have John Viera on with us. He’s the Global Director of Sustainability for Ford Motor Company. Yes, the Ford Motor Company. You can check them out at www.ford.com. If you want to see what they’re doing in green, go backslash green or backslash technology. It’s really, really remarkable how you’re transforming this brand in terms of green and sustainability. Let’s now talk about what you were just mentioning. You’re selling off now what used to go to the landfill to recyclers and what has become now the new form of urban mining, keeping this stuff above ground and getting the metals to scrap dealers and other smelters for reuse. Talk about now what’s coming into your product and coming into making your cars. making your cars out of more sustainable materials. There seems to be a huge trend across so many segments for OEMs both in the car industry, in the electronics industry, in almost everything we create, even homes, building things greener. Are your cars being built now out of more sustainable materials and being built greener than ever before? JOHN VIERA: Absolutely, John, and that is a great point because when you think traditionally, our vehicles were made from raw materials that we were extracting from the earth and there’s only so many earths to go around, right? So, if we continued to do that, we would run out of natural resources so we actually have a concerted effort of what we call moving toward sustainable materials and sustainable materials are basically materials that come either from renewable content, which are basically plant based so you grow the plants and convert that into parts or recycled content so we basically take material that would have been going into landfills and we actually use that to produce parts in our vehicles so I want to give you a couple of examples. For the material that gets recycled from the cars, tires are something that people are pretty aware of, right? We recycle a lot of our tires and if you just look at your black components in your vehicle so if you lift up the hood, there’s like a lot of black rubbery parts, if you look inside the wheel, what we call the splash shields that keep the water outside of the engine compartment, those are our black components. In many cases, those come from recycled tires versus using petroleum to produce those black parts. We use recycled tires. That’s one example but another example, John, what we feel really good about is not only recycled parts from cars but how do we take recycled material from other waste streams from other industries and use that to produce our parts and a great example that we like to use because it’s a visual that people can understand, if you ever look at carpeting, on the back side of carpeting you have padding if it’s the carpeting in your house or in your car. If you look at the padding, it’s typically a bunch of speckled colored material. Well, one of the things that we found was that we can work with one of the big denim suppliers and where they had scrap blue jeans, rather than throwing it out, we actually took those scrap blue jeans, chopped them up, and we actually used that in the padding on the back of our carpets, so we have the equivalent of about two pairs of blue jeans in our Focus, which is our small car and every vehicle and every Focus that we sell and you could say, well, that’s a small amount, but it’s really the concept around how do you get creative to look at waste, not just from your industry, but from other industries and convert that waste into useful input for the parts that are made for your particular product? JOHN SHEGERIAN: And, that’s a great point so that leads then into the life cycle of your car. Is there like a sustainability loop that your cars are becoming part of? Is there a life cycle that’s much more holistic than it ever was 30 years ago when it comes to the vehicles you manufacture? JOHN VIERA: Yeah, absolutely so I want to go through the elements of the life cycle. I think the biggest change has been in the upfront material selection, so that’s more use of recycled content and plant-based or renewable content in the vehicle so that’s the first element of the life cycle, the material selection. Secondly, how do we reduce the amount of waste in producing those vehicles, which I talked about, and recycling that and using less energy. In many cases, that material selection means the parts are lighter so now you’re gonna have a lighter vehicle, which gives you better fuel economy, which is great, and then from an end-of-the-life standpoint, kind of completing the life cycle, how do you make sure that the majority of your product can be recycled? And, a lot of people don’t know but the number one recycled consumer product in the U.S. are automobiles. Eighty-five percent, by weight, of all cars, and I’m talking from all manufacturers, so it’s not just a Ford thing, but 85% of all vehicles get recycled. I think appliances like refrigerators, freezers, are like 82. Newspapers are like 55 so we do have a big focus on this entire lifecycle element, including end of life of how to manage our materials as environmentally friendly as possible. JOHN SHEGERIAN: That’s incredible, but when it comes to that also, I know a lot of other big brands. Let’s just take Walmart, for instance. They have requested and sort of required their suppliers of their goods that they sell to create better packaging, more environmentally friendly packaging and goods and other things. Is the same happening with you? Are you also asking your suppliers to be more sustainable and how does that work in terms of your relationship with your suppliers? While you’re trying to be more sustainable as a company and as cars that you produce, how are you trying to evangelize that, so to speak, down to your suppliers? JOHN VIERA: Yeah, great question, John, because if you really want to be an outstanding sustainable company, it’s not just about what you do within the four walls of your company, but how do you expand it to the supply base so what we have done, John, we actually have what we call an environmental statement of work and what that is it’s a document that’s attached to the contract that we would have with the supplier. As you know, a supplier would need to meet certain financial requirements and quality requirements. Well, they need to meet certain environmental requirements, and their products do as well, before we actually will do business with them and the elements associated with the supplier being more sustainable or environmentally friendly are actually contained in this addendum to the contract called the environmental statement of work and if they don’t meet that statement of work, they don’t get the business, so it very specifically tells them what are the things they need to be doing like packaging or how much energy they’re using in producing their product. All that comes in the environmental statement of work. JOHN SHEGERIAN: You know, John, one of the things I know that you’re in charge of, as are other sustainability officers across America now that are great stewards for companies like yours, is the CSR report. Years ago, they were either nonexistent or not even recognized that much. What does that mean? I know yours is coming out sometime soon. What does that mean for Ford? And, listen, you’ve already travelled six or seven years in this role and you’ve got a lot ahead of you. You’ve got a lot of experience under your belt. Where are you going to be taking this in the future, the next five to 10 years, with regards to sustainability and Ford? JOHN VIERA: Yeah, great question, John, because the sustainability report we have, we’ve been producing the report for a long time so we’re actually coming out with our 14th annual report in mid-June, so it’s been around a while and every year, you’re asking what’s the next thing you’re gonna be highlighting and focusing on. I think the real key for us moving forward, even though we are a global company, a lot of the sustainability elements were focused kind of U.S. based, North American based and I think what you will be seeing is a lot of emphasis on our global sustainability efforts, so not only what are we doing in the U.S., but what are we doing in China, in Brazil, in Russia, in South Africa. We’re really highlighting globally what we’re doing in this space and sharing best practices from one region to another and I think that’s gonna be a real eye-opener for people. JOHN SHEGERIAN: That’s great. we’re down to the last minute-and-a-half or so. You’ve learned so much and you have a ton of wisdom, not only because of 29 years at Ford, but also, you’ve had this unique position. Can you share with our listeners, whether they’re business owners, small and large, or whether they’re just homeowners and families across America, how can we all become part of the solution? Share some of your pearls of wisdom on becoming part of the solution here and becoming greener in everything that we do. JOHN VIERA: Yeah, well, I think one of the things is start small. I think sometimes people, as they think about just the whole concept of climate change and are they gonna be able to affect it or not, it becomes overwhelming so I think the first step is to start small, get some early wins, like we call it, where you can do some small steps that you can implement and then that builds confidence for you to take on more extensive type environmental actions if it’s you as an individual or a small business or even in a large company. JOHN SHEGERIAN: That’s great and for our young people out there, for our college students and high school students that want to be the next John Viera, what do you say to them? JOHN VIERA: What I would say to them is sustainability isn’t just a field that you go into by itself. What you want to do is go into an area that you love. If it’s finance or manufacturing or consumer retail, know that particular area well because you’re gonna love it and then think about within that particular field, what are the elements of sustainability that you can apply to that field? That’s where we’re all gonna have the biggest impact because every single sector, every single area needs to be thinking about sustainability, not as a sidebar, but actually incorporating it into the things they do on a daily basis. JOHN SHEGERIAN: Well, we’re so thankful for great people like you, John, and for great brands like Ford and we’re so thankful you came on the show today. I want to again ask our listeners to go to your wonderful website, www.ford.com. Click on to the green or the technology section. You’ll learn so many things that John discussed today and even more of what Ford’s doing to be sustainable, to be green. It really is so hopeful and we’ve gotta support our great, iconic American brands like Ford that are doing the green thing so they can continue to thrive and grow around the world and as John pointed out, even extend their global reach in both selling their cars and also in sustainability. John Viera, you are a sustainability superstar and truly living proof that green is good.