This report outlines how auto companies can use climate scenario analysis to assess climate change-related risks and opportunities in line with the latest science from the IPCC 1.5°C report. 

Ceres commissioned this framework to provide guidance for automakers in conducting and utilizing climate scenario analysis in strategic planning and product development. It promotes transparent and consistent methodological approaches to facilitate comparisons with scenarios issued by independent scientific bodies and original equipment manufacturers (OEMs). Electric and fuel efficient vehicles, and the use models of autonomous and shared vehicles are examples of many factors to be considered in achieving climate scenario outcomes of well below 2°C, with an aspiration toward a 1.5ºC warming limit. All scenarios should be dynamic, challenge conventional wisdom, acknowledge uncertainties and support contingency plans for the most effective, durable and resilient responses to climate change.

The purpose of rigorous climate scenario analysis is to help inform and influence strategic planning, R&D policy priorities and other key aspects of corporate operations. The goal of this framework – and of climate scenario analysis generally – is to challenge the drivers and underlying assumptions used to develop such business plans. The purpose of scenarios is to identify what could go wrong in making any forecast of the future and highlight the changes needed to build a more durable and resilient long-term strategy. Scenario planning in this context recognizes that climate change poses unprecedented risks and opportunities for companies that require constant monitoring, as well as a willingness to adapt under constantly changing circumstances in a rapidly warming world. Through rigorous scenario analysis, auto companies gain insight to help them urgently make the transition to a zero-carbon economy.