Plastic Omnium - 2018 Registration Document

3 STATEMENT OF NON-FINANCIAL PERFORMANCE CSR at the heart of our strategy PLASTIC OMNIUM 2018 REGISTRATION DOCUMENT 85 The increased use of data will enable operating performance to be improved using these production tools. At two sites, Greer in the United States and Compiègne in France, production capacities are optimized using automation: machine utilization rates are increased reducing lost time and waste. Within companies, data management and robotization will disrupt the trades, requiring effective skills management and development of people’s abilities to adapt. New roles are already appearing, for example, data scientist, artificial intelligence engineer and cyber security specialist. The issue of data protection is becoming ever more crucial, in a context where cyber attacks are increasing and are becoming economic weapons, and where personal data protection regulations are being strengthened across the world. The sharing economy and collaborative mobility Owning a vehicle should no longer be the major concern for users. As a result, in 2030 one third of kilometers traveled could be in “shared” vehicles. Although the total number of vehicles in circulation should decrease in Europe and the United States, the number of vehicle registrations should increase by one third in Europe and by 20% because of the overall wear and tear of vehicles used for car sharing. In China, on the other hand, the total vehicle fleet will increase by 50%. This new method of collaborative mobility will require increased vehicle connectivity. The circular economy and biodiversity The management of fossil and renewable resources is also becoming a major subject of concern. Fossil resources are not inexhaustible and their extraction is a major source of climate change. Their substitution by renewable resources is increasing but, with regards to plastic, is not yet competitive (in terms of expected quality and/or cost). At end-of-life, the quantity of wastes increases significantly. The circular economy aims to develop products which take account of their environmental impact throughout their lives (from the extraction of raw materials to end-of-life). This is reflected in the need for products to be eco-designed in order to improve the resources used and to make products recyclable so that at the end of life, each of the materials or components can be reintegrated within the chain of production. In Europe, the European Directive 2000/53/CE of September 18, 2000 relating to end-of-life vehicles has since 2015 required the re-use and recovery of vehicles at the end of their useful lives, i.e. 95% of the average weight of vehicles each year with a reuse and recycling rate of at least 85%. These major underlying trends are also reflected in strong demand from Plastic Omnium’s customers for it to generate proposals in the area of responsible innovations. Through its positioning as a leader in its markets, Plastic Omnium is playing an important role in this transformation and in the image of the automotive sector. Its customers are developing responsible purchasing policies in which they involve Plastic Omnium through the EcoVadis questionnaire. More and more of them are also joining external initiatives that have a potential impact on Plastic Omnium: for example the Science Based Targets initiative, whose ambition is to set a CO 2 emissions reduction target in line with maximum global warming of 2°C, or even 1.5°C, as established by the Paris Agreement. Plastic Omnium’s growth strategy is based on wholly integrating these challenges within its current and future developments and on its ability to seize the significant opportunities offered by these major trends. In France, the automotive sector has embraced this issue as shown by the signing in 2018 of an industry agreement between the Platform of the Automotive and Mobility Industry (PFA), bringing together 139,000 companies in the sector in France (manufacturers, upstream and downstream stakeholders and R&D players), and the French government. This agreement comprises four major propositions: being a player in the energy and environmental transition; ● creating the autonomous vehicle ecosystem and large-scale ● experimentation in order to offer new mobility services; anticipating the development of skills and job requirements; ● strengthening the competitiveness of the automotive sector. ● These propositions allow the coming major transformations to be built into the strategies of companies and the French government and commit them jointly to achieving targets and the means of implementing them. THE OUTLOOK FOR PLASTIC OMNIUM 3.1.1.4 Plastic Omnium presented its “Living Body” complete concept car, which is designed using a biometric approach (mimicking nature), at motor shows in 2018. This vehicle illustrates the Company’s contribution to the clean and connected car of the future while ensuring safety, namely: a car with an increased range thanks to new weight reduction and ● aerodynamic solutions and the use of supercapacitors to store brake energy; a car with no polluting emissions, fueled by hydrogen and fuel cells; ● a car that communicates with its surroundings thanks to the light ● signature integrated in its structure. In order to achieve this goal, Plastic Omnium plans to invest 6% of its revenue between 2019 and 2021. These investments will be in new capacities, the ongoing optimization of the manufacturing base (industry 4.0 and operational excellence), the development of new programs, and the launch of new research projects. The creation of a new subsidiary “New Energies” demonstrates this commitment in the medium term. In the short term, the strategy of Clean Energy Systems is to continue to develop clean solutions, principally for hybrid vehicles. This investment program will support the growth of Plastic Omnium which is planning to grow by five points more than the market and to improve its market share for its three Divisions by 2021: Intelligent Exterior Systems will achieve 19% (16% in 2018), Clean Energy Systems will also grow by three points to 25% and HBPO will gain one point to 18%. A plant opening program goes hand-in-hand with this growth outlook including nine construction projects by 2021. Intelligent Exterior Systems will open plants in India, Morocco, Slovakia and China. A plant will be developed in Malaysia for Clean Energy Systems, and HBPO will consolidate its position in Germany with two new assembly plants as well as in Mexico and in China.