Logistics and Transport
Reducing our emissions is an important target within our transport and logistics concepts.
- We set ourselves the overall aim for 2025 to reduce the emissions from transporting our products by around 15 percent compared to 2015.
- We also aim to use renewable electricity at 50 percent of our pallet spaces within Henkel-operated warehouses by 2025.
- We continue to focus on expanding intermodal transport, improving our warehouse network and optimizing transportation.
- Close collaboration with our suppliers and customers plays a key role.
- We also optimize our products and packaging in terms of weight and volume, provided this is possible without compromising their performance, convenience and stability.
- Further, when choosing our transport partners, we take efficiency as well as environmental and safety performance into account.
- Company-wide IT-solutions enable us to systematically record the CO2 emissions of our logistics operations and to handle our transport planning and execution more efficiently across all business units and countries.
Optimizing our logistics footprint
Expansion of intermodal transport
Improving our warehouse network
Digital tools for improved logistics
Alternative mobility solutions
Our approach to reducing our logistics footprint starts in the product development stage. This is why we are optimizing our products and the related packaging in terms of weight and volume, whenever it is possible to do so without compromising performance, convenience or stability. More concentrated products and lighter packaging reduce transport weight, which decreases the amount of fuel required during transport and reduces the related emissions. Improving our logistics structures also helps to reduce transport emissions. Our approach takes the location of our production sites into account. For bulkier products, we reduce transport distances and environmental impact by operating regional production sites. For compact products, we leverage efficiencies in production by manufacturing these products centrally whenever possible. For transportation and logistics for finished goods, we focus our efforts on three major drivers:
- Expanding intermodal transport
- Improving our warehouse network
- Optimizing transport
We leverage these three drivers through close collaboration with our suppliers and customers to implement joint logistics projects. We also use advanced digital solutions and alternative propulsion systems for transport. When choosing our transport partners, we consider efficiency, environmental compatibility and safety performance. Relevant criteria are included in our tendering and decision-making processes for the purchase of logistics services.
Intermodal transport involves using more than one mode of transportation. At Henkel, this means more of our transports are being switched from road to rail. This process begins with a truck carrying the goods to the nearest rail loading terminal. From there, the goods cover longer distances by train, before a second truck collects the goods at the destination terminal and delivers them to the customer. This allows us to make use of the lower CO2-footprint of rail transport compared to road transport, since a train emits about one-third of the CO2 of a truck when transporting the same weight of goods. For this reason, intermodal transport has become a key driver for CO2 reduction in logistics at Henkel. Through our dedicated tendering processes, we are adding further train routes in Europe to support our shift toward intermodal transport. We stepped up these efforts further in 2021. Since May 2021, detergents and cleaning products produced at our site in Kruševac, Serbia, have been transported to Vienna by truck and from there to Düsseldorf by rail. This approach saved about 280 tonnes of CO2 in 2021. This project is an important step for Henkel in expanding intermodal transport because the route was previously served exclusively by trucks. We have also increased the share of intermodal transports on the Hungary-Düsseldorf route by 360 more transports per year.
We select the location of our warehouses and distribution centers to optimize the routes between our production sites and our customers. A “wall-to-wall production” approach, where the warehouse is directly connected to the production facility, minimizes transport from production to storage. Where this is not in place, we achieve synergies by consolidating transport between individual factories and warehouses. We also make use of the “mega warehouse” concept, where a small group of main distribution centers store products until the required quantities are due for on-time delivery to regional warehouses and retailers.
We continuously increase the capacity utilization of our cargo containers by expanding our pooling activities. This includes the targeted consolidation of transport and storage of similar product categories within Henkel, as well as combining transport with other manufacturers. In addition, closely collaborating with our customers further helps to optimize our processes. The resulting synergies in storage, consignment and transportation ensure that more fully loaded trucks travel to our customers’ central warehouses. We also rent pallets instead of buying them. This makes it more efficient to collect them and improves the management of damaged pallets. Where possible, we utilize reusable cardboard pallets instead of wooden pallets. Due to their lighter weight, they are easier to handle and reduce fuel consumption. We have recently continued to streamline our pallet use, and we have implemented various solutions to reduce the overall use of pallets and increase their reuse rate.
Our transport management system systematically captures the CO2 emissions of our logistics operations and makes our transport planning and implementation even more efficient across all business units and countries. Higher truck capacity utilization and optimized routes play a particularly important role in reducing transport kilometers, cutting fuel consumption and saving CO2.
Our progress is presented using a digital tool that calculates the environmental impact of transportation for all modes of transport based on the DIN EN 16258 standard. Inputs include actual distances based on GPS data, country-specific emission factors, and data from the respective modes of transportation.
The combined application of both IT solutions enables us to foster transparency and data comparability across the entire industry and helps us to track progress toward our emissions reduction target. By the end of 2021, Henkel had achieved a reduction in transport-related emissions of about 14 percent compared to 2015. Our logistics emissions have been calculated using a new methodology developed by our service provider ETW since 2021. By recalculating the values for the previous year, we intend to have in place a method for reliably tracking progress made towards the target. Progress in the previous target period from 2015 to 2020 is not affected.
Beyond the use of advanced digital tools, alternative propulsion types also form part of our approach to optimizing transport and logistics. We are testing the operational capability of vehicles powered by alternative propulsion systems at our sites. At our headquarters in Düsseldorf, we have, for example, incorporated around 43 electric vehicles into the internal fleet since 2012 to replace conventional vehicles with internal combustion engines. In 2021, we also converted the first in-house vans to purely electric vehicles. We have built a corresponding infrastructure with over 120 charging stations in and around the industrial park, ten of them in cooperation with the utility company Stadtwerke Düsseldorf. Our vehicle policy for electric and hybrid cars also gives our employees in Germany the option of driving an electric or hybrid vehicle as a company car.
In 2019, the first hydrogen-powered vehicle was added to the internal fleet at our Düsseldorf plant, and a hydrogen filling station was installed. To promote hydrogen mobility, Henkel has been actively engaged over the past few years in various initiatives and research projects, such as “Modellregion Wasserstoffmobilität NRW Düssel.Rhein.Wupper.”. However, hydrogen mobility solutions suitable for our logistics operations are not currently available for mass production. For this reason, we are exploring several alternatives for sustainable logistics that are ready to contribute today.
The deployment of conventional combustion engines that run on Compressed Natural Gas (CNG), which is mainly composed of methane, is one of the technologies that we are implementing into our business operations as part of our journey toward more sustainable mobility. CNG produces the least amount of CO2 of all types of fossil fuel combustion. As a test, we have continuously operated CNG-powered trucks for delivery runs on the route between Serbia and Austria since 2021. The use of a CNG powered truck saves about 14 percent of CO2 emissions on this route compared to a conventional diesel truck. Trucks powered by liquefied natural gas (LNG) are another alternative mobility solution for Henkel. Since 2020, two LNG-powered trucks have been traveling on our supply routes from Düsseldorf to Bönen, Germany, and Barcelona, Spain. The technology saves 20 percent of CO2 compared to conventional diesel trucks. In 2021, the Düsseldorf site logistics operations commissioned another LNG truck, which will also be used on the Düsseldorf-Bönen supply route.
Alongside transport to locations outside of our company’s premises, we also make use of alternative transport modes for internal deliveries at our sites. In the context of future mobility, we also seek to reduce transport-related emissions by generating a holistic, modern and sustainable concept to foster our staff’s mobility.