In a similar vein to automotive companies—and many other companies—IKEA’s vision is to “create a better everyday life for many people.” The mantra has been the same at the Swedish retailer for more than 75 years, even though the priorities have changed during that time.
“The world is constantly changing, so we’re not concerned with the same things today as we were years ago,” explained Angela Hultberg, Head of Sustainable Mobility at Ingka Group, owner of IKEA. “And years ago, we weren’t concerned with some of the things we are very concerned with today.”
One of the challenges facing Hultberg in her role is common: the continuing trend of urbanization means a majority of people will live in large cities in the future.
“We need to make sure cities are healthy and sustainable places to live—and make sure they function for the people,” she said.
The realization of this aim has come, in part, from the dramatic change in customer shopping habits. IKEA’s online shopping sales increased 50% in 2019 alone—meaning an increase in the number of deliveries and, therefore, more delivery vehicles, congestion, and pollution in the city centers.
“It might be a leading question, but every retailer and business should ask, ‘Do we want to be part of the problem in cities or part of the solution?’ once in a while. When we looked into it, we realized that mobility is part of everything we do,” said Hultberg, who also realized that, as well as the customers, she had a responsibility to the company’s 166,000 coworkers, many of whom travel by themselves to the stores.
Aware that the solutions would not be straightforward or quick, Hultberg and her team set a number of targets. The most immediate one is, by the end of 2020, to have charging opportunities for customers and coworkers in all of the retailer’s markets. Then, by 2025, the target is to have 100% of home deliveries undertaken by electric vehicle or zero-emissions transport (she cited cargo bikes as one example, along with any potential new technologies).
“We then thought that, if we are expecting our transport service providers to change their fleets, we should lead by example,” she explained. “That means that all of the vehicles we own or operate should also be electric.”
The biggest target—set for 2030—is to halve the emissions produced by customers and coworkers. Because the stores are located in areas that are only reached easily by car, the emissions produced by customers traveling to and from stores is the third largest emitter in the company’s value chain.
The most immediate goal, said Hultberg, is going well. Three months into 2020 and she reported that more than 80% of stores worldwide have vehicle charging capabilities. Work on the 2025 target is also progressing.
“We took five cities and aimed to transform them even faster—by 2020—to electric deliveries,” she said. “We chose New York, Shanghai, Paris, and Amsterdam—different markets because the last-mile industry looks very different in each one. We’re aware that there is no magic bullet that will work everywhere; we need different solutions for different markets using different types of mobility.”
In five Chinese cities, including Shanghai, all home deliveries are now completed using EVs. In addition, electric delivery vehicles have deployed in 19 of IKEA’s 30 markets, with more in the pipeline, according to Hultberg.
“What we have learned so far is greater than what we have achieved,” she stated. “One reason we were so quick to reach our goal in Shanghai was that we teamed up with an EV-sharing platform, which was a new concept for us. It allowed us to cut months out of the project [six months total project time] because we had access to the vehicles and the charging infrastructure.”
Turning to the issue of staff and customer travel—and reducing their emissions—carsharing is a major consideration for Hultberg.
“Coworkers traveling on their own is not an efficient use of resources. We need to take more responsibility as an employer because this is also about mitigating a business risk. The number one reason that consumers are not our customers is accessibility,” she revealed. “Around 20% of the workforce is under 24, and a lot of them don’t have cars. But they want to live in the city center, which is where we aren’t located. So how do we stay an attractive employer if people can’t get to work? This isn’t a sustainability issue, it’s a business issue and a cultural issue.”
Fully aware of the pressures on companies such as IKEA to become more sustainable, Hultberg knows the company cannot wait for a “perfect solution” because it doesn’t exist.
“[At the moment], the vehicles aren’t perfect, the charging infrastructure isn’t mature enough, and the costs are too high,” she reasoned. “But just because something is hard doesn’t mean you don’t do it. And just because you don’t have all the answers doesn’t mean you can wait.
“We can’t wait for innovation to save us because innovation means nothing unless someone deploys it, and that is what we need to do,” she added. “We’re not going to reach 2025 or 2030 targets on 2020 conditions; for us it is about taking the best possible solutions we can find and trying to make them work.”
Hultberg explained that IKEA has engaged with OEMs even though it doesn’t even have a fleet, admitting that is where the company needs to be.
“We’ve invested billions of Euros in renewable energy,” she said. “We need to connect all the dots to the grid so the capacity we have in our buildings will feed chargers so that customers will be able to travel to us. And we need to do it now. If we don’t, we’ll be left behind. Commitments are great, but actions always speak louder than words.”