ZAPI GROUP’s vision for a sustainable circular supply chain in the electrification of industrial vehicles

In an era marked by rapid technological advancements and growing environmental consciousness, the automotive industry stands at a pivotal juncture. With the paradigm shift towards electrification gaining momentum, sustainability has emerged as a core focal point for industry stakeholders worldwide. Against this backdrop, Automotive Industries had the privilege of engaging in an insightful conversation with Olimpia Bertarini, the esteemed Global Purchasing Director of ZAPI GROUP.

The automotive landscape is witnessing a transformative shift towards sustainability, with electrification emerging as a cornerstone for achieving environmental objectives. Olimpia Bertarini elucidates ZAPI GROUP’s vision for fostering a circular supply chain within the commercial and industrial electric equipment and vehicle industry. Embracing circularity entails a comprehensive approach aimed at reducing waste, reusing materials, and recycling products throughout their lifecycle.

ZAPI GROUP’s commitment to sustainability extends beyond rhetoric, permeating every facet of its supply chain operations. By aligning sustainability initiatives with its overarching mission, the company underscores its dedication to engineering a transition towards an all-electric future. Zero-defect targets serve as a catalyst for driving efficiency and minimizing environmental footprint, while a circular mindset underscores the development and procurement of components for electric vehicles.

As pioneers in the realm of electrification, ZAPI GROUP confronts an array of challenges on its journey towards implementing circular supply chain practices. Effective communication and collaboration with key stakeholders, including customers and suppliers, are paramount. Addressing concerns surrounding transparency and traceability in material sourcing necessitates robust mechanisms and partnerships grounded in shared values of sustainability.

Ethical considerations, encompassing labor rights, environmental impact, and social responsibility, lie at the heart of ZAPI GROUP’s procurement practices. Regulatory compliance serves as a foundational pillar, augmented by the establishment of a supplier code of conduct and rigorous evaluation processes. Collaboration emerges as a linchpin for fostering innovation and driving sustainability initiatives forward.

ZAPI GROUP’s commitment to sustainability yields tangible outcomes, exemplified through notable successes and case studies. Leveraging its global footprint and system integration expertise, the company delivers holistic solutions that optimize performance, reduce emissions, and empower local communities. These achievements underscore the efficacy of circular supply chain practices in delivering both environmental and business benefits.

Operating in a globalized landscape necessitates navigating variances in regulations and policies pertaining to sustainability. ZAPI GROUP’s proactive approach involves standardizing metrics, ingraining sustainability into corporate culture, leveraging technology to ensure compliance across its supply chain, and creating education opportunities such as its Future of Electrification conference, facilitating discussions around key electrification initiatives.

Technological advancements, ranging from IoT to AI, play a pivotal role in enabling ZAPI GROUP to build a sustainable circular supply chain. These innovations enhance process optimization, data visibility, and collaboration across extended supply chains, thereby driving efficiency and fostering resilience.

Looking ahead, ZAPI GROUP remains steadfast in its commitment to driving sustainability and innovation in electrification across industries. Anticipated trends, including the emergence of second-life batteries and enhanced supply chain resilience, underscore the company’s proactive stance in shaping the future of electrification.

In essence, ZAPI GROUP epitomizes the transformative potential of sustainability-driven practices in redefining the industrial and commercial equipment landscapes. As the industry marches towards a greener, more sustainable future, the company stands poised to lead the charge, leveraging its expertise, innovation, and unwavering commitment to environmental stewardship.

Automotive Industries interview with Olimpia Bertarini, Global Purchasing Director, ZAPI GROUP

Automotive Industries: Hi Olimpia, how does ZAPI GROUP envision the role of a circular supply chain in achieving sustainability goals within the automotive industry, particularly in the context of electrification?

Bertarini: The circular supply chains in the industrial and commercial equipment sectors are currently evolving, particularly with the increasing focus on electrification. This trend has already been successfully implemented and leveraged in the automotive industry, with electric vehicles leading the way. We see a similar shift towards electrification in industrial and commercial equipment sectors, indicating a growing convergence towards more sustainable practices.

A circular supply chain is a model that prioritizes sustainability and the efficient use of resources throughout the lifecycle of products. Circular supply chains focus on reducing waste, reusing materials and recycling products at the end of their lifecycle.

In some countries, regulatory mandates and incentive programs for sustainability are helping drive demand for circular supply chains.

Focusing on ZAPI GROUP, reaching a circular supply chain has been an ongoing journey since the company’s foundation.

Automotive Industries: Could you elaborate on specific strategies ZAPI GROUP employs to integrate sustainability principles into its supply chain operations, especially in the development and procurement of components for electric vehicles?

Bertarini: First, we are aligning our sustainability initiatives with our mission, which is “engineering the transition to an all-electric future.”

Second, we are proud to prioritize our zero-defect target as a key focus area. This commitment drives us to strive for zero waste, zero return, and zero repair.

Finally, our approach focuses on a circular mindset throughout the product and component life cycle. We prioritize using existing parts during the design phase and ensure that new parts comply with regulations.

Automotive Industries: In the journey towards electrification, what challenges does ZAPI GROUP encounter when implementing circularity in its supply chain, and how does the company address these challenges?

Bertarini: Our primary focus is addressing challenges involving our key stakeholders – our customers and suppliers. One significant challenge we are navigating revolves around communication and collaboration as the industry grapples with implementing the concept of circularity throughout the product life cycle.

We must closely engage with our customers to understand their circularity requirements and envision the system architecture for the entire product ecosystem. This means translating these insights into specific component specifications and integrating them into the design process through collaborative efforts.

For suppliers, a distinct challenge emerges in ensuring transparency and traceability in the materials we source. It is imperative for us to have a clear understanding of factors such as recyclability percentages and CO2 emissions associated with the materials supplied by our partners. Establishing robust traceability mechanisms is crucial in this regard.

There is no consistent global alignment on KPIs and a lack of common rules and/or regulations globally for circular supply chains. The industry is making progress towards enhancing transparency and collaboration, but there remains a considerable amount of work to be done. Initiatives such as carbon footprint assessments and digital passports for products are steps in the right direction, but there is still ample room for improvement and standardization in these areas.

Automotive Industries: With the increasing demand for electric vehicles, how does ZAPI GROUP ensure the ethical sourcing of materials for its products, considering factors like labour rights, environmental impact, and social responsibility?

Bertarini: ZAPI GROUP strictly adheres to regulations that, in regard to sustainability, are not yet standardized at a global scale. For example, in Europe, major regulations are REACH, RoHS, and PFAS, which limit the use of harmful chemical substances for environmental and public health protection. In the U.S., there are different regulations, such as TSCA and Prop65, whereas, in Asia, the maturity level of sustainability seems quite ahead.

Regulations do not fully cover ESG topics, so ZAPI GROUP has released a supplier code of conduct for all our business partners. Additionally, to homogenize supply chain ethical practices, we have enlarged the supplier’s evaluation process beyond traditional criteria like quality management and financial measures by also assessing ESG factors – environmental, social, and governance compliance.

Automotive Industries: Collaboration is crucial for building a sustainable circular supply chain. How does ZAPI GROUP engage with its suppliers and partners to foster collaboration and innovation in sustainability initiatives?

Bertarini: We put a lot of emphasis on what our customers expect and need. They are increasingly passing on their concerns about sustainability to us, such as requesting CO2 emission data in our quotes for new parts and having our sustainability efforts certified by an independent third party to prove our progress in environmental, social, and governance (ESG) matters.

As previously mentioned, we recently enhanced our supplier management procedures to include sustainability in the validation process for new suppliers. In addition, we strongly motivate our active vendors to achieve a zero-defect target, as it is a key metric in the ZAPI GROUP vendor rating system.

Automotive Industries: Could you discuss any notable successes or case studies where ZAPI GROUP has effectively implemented circular supply chain practices, leading to tangible environmental or business benefits?

Bertarini: As a global group of companies, we are fortunate to have most of the powertrain components and system integration capabilities within our group. We bring to customers our system integration expertise and accompany their transition to electrification.

Leveraging best practices among our group, we can support our customers since the design phase by proposing an integrated system that can optimize performance, dimensions and costs. This concretely contributes to sustainability. In addition, thanks to ZAPI GROUP’s global footprint – as we have manufacturing locations in each region of the world – we can localize our production in the same region where our customer facility is located. This concretely helps the environment by heavily reducing CO2 emissions and gives a social benefit by employing local manpower.

Automotive Industries: As a global company with operations in various countries, how does ZAPI GROUP navigate differences in regulations and policies related to sustainability and circularity, and how does it ensure compliance across its supply chain?

Bertarini: One of the challenges is that each region has different metrics, so we must look at standardizing that using a baseline and ingraining that into the corporate culture to ensure that this is being followed through as a practice.

In our reporting process, we carefully assess the thousands of components that make up a powertrain system by closely examining our suppliers. Through supplier audits, we look at data to ensure compliance with metrics and sustainability standards. It’s not just about ticking off boxes; it’s about ensuring a smooth transition towards more sustainable practices.

Last year, we implemented a new web platform called Supply Chain Sustainability Platform to measure and monitor regulatory compliance. The platform tracks components and their manufacturing processes’ compliance with all regulations.

Automotive Industries: What role does technology, particularly innovations in systems integration and autonomous navigation software, play in enabling ZAPI GROUP to build a more sustainable circular supply chain for electrification?

Bertarini: Adopting emerging technologies like the Internet of Things and artificial intelligence enables process optimization and data visibility and accelerates information sharing across long supply chains. These technologies play a crucial role in enhancing industry processes beyond just electrification. The Supply Chain Sustainable Platform mentioned above is an example of how ZAPI GROUP is turning to digital tools and emerging technologies to enhance traditional industry processes.

In addition, understanding battery health and usage through analytics is essential for maximizing performance metrics and driving efficiency in evolving systems. ZAPI GROUP’s charging solutions support an unprecedented range of power and battery chemistries to propel global electrification. As electrification advances and collects more data, we will continue to innovate with intelligent systems and software that shape the future of supply chain management.

Automotive Industries: Looking ahead, what future trends or developments do you foresee in the realm of sustainable circular supply chains for electrification, and how is ZAPI GROUP positioning itself to stay at the forefront of these advancements?

Bertarini: Establishing a circular supply chain plays a significant role in achieving environmental, social and economic goals as clearly outlined in the United Nations’ 2030 agenda for sustainable development. Efforts shall be dispensed by all economic stakeholders, including government and non-profit organizations. Companies like ZAPI GROUP can actively promote sustainable economies by incorporating circularity concepts into product marketing to showcase contributions to sustainability. We are also committed to learning and creating education opportunities with our annual Future of Electrification virtual conference that facilitates global collaboration and networking across industries.

Enhancing sustainable and circular processes will also support the establishment of more resilient supply chains. If we can use fewer resources, we can increase our ability to navigate challenges in the supply chain like the ones that occurred during recent years’ unexpected disruptions.

ZAPI GROUP is motivated by the opportunity and challenges to achieve sustainable and circular supply chains in electrification. We continue to lead innovations in full-electric and hybrid industrial and commercial vehicles and strive to be at the forefront of any advancement in electrification trends.