At Oerlikon, we see combating climate change as similar to engaging in groundbreaking R&D: if initial results are not fully aligned with expectations, we analyze the data and extract the lessons learned that we can use to attain optimal outcomes.
Qualification of Sustainable Products
Data collection and development of methodologies empower us to see where we are hitting our performance benchmarks and where we need to make further efforts and investments in sustainable innovation solutions.
Oerlikon serves customers in the automotive, textile, polymer processing, tooling, space and aviation sectors, who in turn have customers in the defense industry. Oerlikon also provides solutions to the oil and gas industry. In these industries, Oerlikon takes a best-in-class approach in helping customers in these sectors to reduce their environmental or social footprint and meet their targets. Sales generated from defense and oil and gas comprise less than 5% of Oerlikon’s total revenue.
In 2021, we defined the criteria to categorize our products’ sustainability. We grouped them into three categories:
- Our tool coatings, whose objective is to improve customers’ production process from a sustainability perspective and so contribute to responsible consumption and production.
- Our component and materials business, whose objective is to enable sustainable applications or improve the overall system with regard to sustainability and thus contribute to climate action such as reducing CO2 emissions in aerospace.
- Our equipment business, whose objective is to achieve more sustainable production.
We consider our tool coatings to be sustainable when they improve the production process of at least one of the following: raw material consumption, energy consumption, emissions or service time. At the same time, the coating must deliver the same or better performance than the industry standard.
Our consolidated data shows that all our tool coatings improve at least one of the environmental criteria, as tools with standard coatings or high-performance coatings can perform up to ten times better than an uncoated tool. Comparisons of our tool coatings with industry standards identified some gaps — most already known — that contributed to our blueprint for R&D investments in next-generation coatings.
The component and materials business encompasses precision components, friction systems components, the materials business and additive manufacturing. As this is the broadest scope of our business, we define criteria based on the product application. The solution needs to improve the overall system compared to the industry standards in one or more of the following areas: energy consumption, social impact, waste, emissions or service time. Solutions are not classified as sustainable if there is no comparable industry standard.
Within our equipment business, we classify as sustainable any equipment that can reduce environmental impact relative to the industry standard in terms of one or more of the following: raw material consumption, energy consumption, water consumption, social impact, waste, emissions or service time.
In 2022, we supplemented our qualification process for our products with an assessment process for R&D projects. This process involves a two-tier evaluation.
In the first tier, projects that support green technologies and transitions, such as phasing out fossil fuels, advancing e-mobility, improving safety and healthcare or promoting a reduction in waste are automatically considered sustainable.
In the second tier, we consider:
- The impact of projects for customers: for example, if the product from the project enables customers to shorten development time, operate more sustainably (e.g. reduce CO2), or improve performance that has an indirect positive impact on sustainability (e.g. less waste from fewer test parts).
- The goal of the research: in collaborations with universities or in projects supported by public funding, if the goal is to improve products or their performance, they are classified as sustainable.
- Digital benefits: if the machine learning or software solutions and upgrades can also reduce scrap and energy consumption, they are considered sustainable.
Conversely, if the goal of the project work is solely to reduce production costs, then it is considered unsustainable.
Based on these criteria for products and projects, 73% of our total R&D investment in 2022 was in sustainable products.
Formalizing these criteria and categorizations enable us to identify challenging areas that we need to address in our investments for sustainable products. We continue to collaborate with our customers on the delivery of solution upgrades that will strengthen our technology leadership. At the same time, we will work toward our 2030 R&D target, where 100% of R&D spend (excluding defense and oil and gas) is on sustainable products.
Case study: Award-Winning Thermal Insulation Solutions for Future Mobility
The penetration rate of new energy vehicles is growing worldwide, leading to tremendous changes in the automotive market. However, passengers’ safety is still a primary concern when incidents can generate smoke, fire, heat or cause an explosion. Thus, thermal protection is essential to avoid overheating of the passenger compartment during inadvertent malfunction in Battery Electric Vehicles (BEV), Plug-In Hybrid Electric Vehicles (PHEV) and Fuel Cell Electric Vehicles (FCEV).
Oerlikon’s environmentally friendly (mica free and non-petroleum based) thermal insulation products offer fully engineered solutions that meet customer requirements, validated in our state-of-the-art laboratory and fulfilling legal safety demands with minimum installation space.
Oerlikon’s HS900 product series offers superior temperature and excellent hot gas particle impact resistance, combining customized 3D formability and compact design – the desired lightweight and clean solution to help e-mobility meet advanced global battery safety requirements and legal regulations. In addition to these features, the ultrathin HS900 product series is mica-free with zero physical harm during production, contributing significantly to the environment as well as being ESG compliant.
In August 2022, Oerlikon China was awarded the “Annual Thermal Management System Innovation Award” at the 12th New Energy Vehicle International Forum for remarkable innovation of multifunctional thermal insulation materials, which are applied in EV battery systems for superior safety solutions.
Thermal insulation is essential to avoid overheating of the passenger compartment providing protection to vehicle occupants during thermal runaway caused by inadvertent malfunction of lithium-ion batteries.
