Climate Change Data

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Disappointing sporting performance in the DTM (Deutsche Tourenwagen Masters) in 2014, leading to unplanned additional expenses.
• Reduced demand for the SLS AMG GT3 customer sports project due to its advanced lifecycle.
• Increased competition in the GT3 segment.

Mitigation Strategies

• Intensive use and implementation of development possibilities in the DTM in 2014.
• Development of the Mercedes-AMG GT3 as a successor to the SLS AMG GT3 to diversify the customer sports segment.
• Continued focus on the competitiveness, reliability, and quality of the SLS AMG GT3 to minimize customer churn.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

Social Achievements

• Successfully completed a reorganization program in 2017, resulting in increased efficiency and reduced manufacturing depth.
• Implemented measures to improve teamwork within HWA AG.

Climate Goals & Targets

Environmental Challenges

• Daimler AG's decision to discontinue its motorsport activities in the DTM series after 2018, impacting HWA AG's revenue.
• High working capital due to significant growth in the Vehicles/Vehicle Components segment.
• Intense competition in the GT segment.
• Dependence on Daimler AG and Mercedes-AMG GmbH for a significant portion of HWA AG's business.
• Dependence on financial capabilities of teams and external sponsors in the Formula 3 motor leasing and sales business.

Mitigation Strategies

• Securing a customer team role with VENTURI in the ABB FIA Formula E Championship for the 2018/2019 season.
• Exploring and working on additional projects in motorsport.
• Implementing a reorganization program to optimize and realign individual areas, resulting in increased efficiency and reduced manufacturing depth.
• Diversifying the customer structure through new projects independent of the Daimler Group.
• Continuous monitoring of exchange rates and using derivative financial instruments to hedge risks.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Sustainability
• Electrification

Environmental Achievements

• Maintained DIN ISO EN 14001 and FIA Sustainability Accreditation Standard certifications.
• Research project with DLR and Baden-Württemberg to develop a zero-emission drive axle.

Social Achievements

• HWA AG has an integrated quality management system in place which was developed in line with the 9001:2015 standard and successfully audited by DEKRA Certification GmbH.
• Annual occupational health and safety training for employees.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Delayed start of some planned development projects in Mercedes-AMG customer sports.
• Disruptions due to the COVID-19 pandemic and its impact on racing events, particularly in China.
• Supplier and raw material bottlenecks.
• Loss of a driver in Formula 2, leading to potential sales revenue decline.
• Planned discontinuation of Formula E project and the changing market requirements.
• Lawsuits in the US relating to sponsorship and Formula 3 deployment in Macau.
• Consequences of prosecution from the joint venture VYNAMIC.

Mitigation Strategies

• Cost-cutting program (optimizations in IT infrastructure, consulting services, and personnel).
• Increased use of short-time work.
• Initiation of new development projects in Mercedes-AMG customer sports and other areas.
• Countermeasures taken to mitigate the effects of the Formula E project discontinuation.
• Divestment of Formula 2 and Formula 3 business area.
• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: DIN ISO EN 14001, FIA Sustainability Accreditation Standard, ISO 9001:2015

Third-party Assurance: DEKRA Certification GmbH

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Electric caravan (KNAUS E.POWER DRIVE)

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Sustainability
• Employee well-being
• Environmental Management
• Quality Management

Environmental Achievements

• Achieved and maintained DIN ISO EN 14001 and FIA Sustainability Accreditation Standards.
• Research project with DLR developing an emission- and particulate matter-free drive axle (prototype presented September 28, 2022).

Social Achievements

• Annual employee training on occupational safety and health.
• Integrated quality management system (ISO 9001:2015) successfully audited by DEKRA Certification GmbH.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Raw material shortages and disrupted supply chains due to the Russia-Ukraine war, impacting material supply, vehicle production, and customer/racing team component supply.
• Delays in planned development projects in the first half of 2022.
• High inflation, semiconductor and other industrial input availability, and the ongoing COVID-19 pandemic (including China's zero-COVID policy) creating uncertainty.
• Rising prices (procurement, energy, gas), material availability, and order situation in development areas.

Mitigation Strategies

• Ongoing cost-cutting program (e.g., IT infrastructure and software optimization).
• Active management of disruptions in spare parts supply and vehicle production.
• Numerous development projects commissioned and started in the second half of 2022.
• Implemented information system to identify, analyze, and assess potential risks early and initiate effective strategies and measures.
• Focus on a strong and fluctuation-resistant business model.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of emission- and particulate matter-free drive axle

Reporting Standards

Frameworks Used: Null

Certifications: ISO 9001:2015, DIN ISO EN 14001, FIA Sustainability Accreditation Standard

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Emission- and particulate matter-free drive axle

Awards & Recognition

• Not disclosed