2025.02.14
Panasonic Group People
Balancing Environmental Considerations and Cost Optimization to Shape the Future of Sustainable Procurement: Daisuke Okumura
Series:
Key Figure in Raw Material Procurement for Sustainable EV Batteries
Daisuke Okumura
Engineering Procurement Promotion Department, Procurement Division
Mobility Energy Business Division
Panasonic Energy Co., Ltd.
Okumura joined the company in 2003, initially handling rare metal sales at the Corporate International Trade Division (at the time). He later spent five and a half years in Shanghai, China, gaining experience in group-wide centralized contracts for battery materials, steel, and resins. After returning to Japan, he engaged in lithium-ion battery material procurement. He is currently involved in cost reduction for raw materials, supplier selection, and BOM*¹ cost management, primarily for automotive applications.
＊1: Bill of Materials (BOM): The total cost of all components and materials required for product manufacturing.
Taking on the Challenge of Reducing Environmental Impact Across the Entire Supply Chain
As increasing importance is placed on sustainability and ESG, the role of procurement has undergone a significant transformation in recent years. Sustainable procurement is now a key element of environmental consideration and social responsibility. In addition to the traditional Quality, Cost, and Delivery (QCD) criteria, reducing environmental impact has become a key factor in supplier selection.
In the value chain of automotive lithium-ion batteries, a substantial portion of CO₂ emissions arises from raw material extraction, processing, and transportation, more so than battery production itself. Notably, the procurement of cathode and anode materials associated with battery performance and safety accounts for nearly half of these emissions. In response, Panasonic Energy Co., Ltd. has set a goal to halve its carbon footprint (CFP)*² by FY2030 compared to FY2021. To achieve this, the company is advancing initiatives to minimize environmental impact across the supply chain in addition to realizing net zero CO₂ emissions at its own plants (becoming carbon neutral).
Additionally, procurement must quickly adapt to price fluctuations caused by factors beyond our control, such as geopolitical risks and policy changes. To enhance resilience, we are not only diversifying supply sources but also working closely with customers to identify and secure safer, higher-quality raw materials, strengthening the resilience of our procurement operations.
＊2: Carbon Footprint (CFP): CO₂ emissions converted from greenhouse gas emissions throughout the entire product life cycle—from raw material procurement to disposal and recycling of a product or service.
Increasing the Local Procurement Rate to Accelerate a Sustainable Procurement Strategy
Various initiatives are underway in the United States, the key battleground for automotive lithium-ion batteries. Since 2019, Panasonic Energy has partnered with the US-based battery recycling company Redwood Materials. Together, they are working to establish the first cathode material recycling system in the US by recycling battery waste materials from Panasonic Energy of North America’s factory and using them to manufacture new cathode materials.
If successfully implemented, this initiative will also enhance local procurement rates in the US, aligning with the goal of strengthening North American supply chains. However, ensuring economic feasibility is critical to its success. In addition to improving material recycling rates, extensive discussions and negotiations are ongoing to keep costs competitive with existing cathode materials in the market.
We showcased NMG’s environmentally friendly graphite powder at the Panasonic booth at CES 2025.
Until now, much of the graphite used in anode materials came from Asia, creating issues with transportation costs and environmental impact. To address these issues, we have signed a long-term supply agreement with Canada-based Nouveau Monde Graphite (NMG), a company that produces graphite using renewable energy from hydropower.
By accelerating this sustainable procurement strategy, we aim to reduce the CFP of battery production and establish a low-environmental-impact supply chain.
In the increasingly competitive market for automotive lithium-ion batteries, survival depends not only on quality and cost but also on speed. Introducing new materials, including the evaluation process, has traditionally taken several years. This is too slow to keep up with rapid global changes.
Recognizing this challenge, we are reviewing evaluation methods, risk management processes, and other key procedures. By working closely with our customers to gain their understanding and cooperation, we are working to shorten the time required for material adoption.
Leading the Development of a Circular Economy for EV Batteries
Our goal is to first build an environmentally conscious supply chain in the US to establish a circular economy for automotive lithium-ion batteries and then expand the initiative to Japan. To scale these efforts, connecting recycling companies and cathode material manufacturers is essential, creating a cohesive ecosystem. While there are significant technological and cost-related challenges to overcome, advocating for the importance of tackling these issues and leading the way is a crucial role of procurement.
Panasonic Energy's mission is “Achieving a society in which the pursuit of happiness and a sustainable environment are harmonized and free of conflict.” To me, harmony means balancing environmental responsibility with economic viability. Without achieving this balance, our mission cannot be fulfilled. It is an extremely challenging goal, but by driving reforms with both caution and boldness, we are committed to advancing the adoption of EVs—key to realizing a decarbonized society—and will continue to take on this challenge with determination.
Touring a factory to select a new supplier (Okumura is second from the left)
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