Lego is taking vital steps to interchange fossil fuels in its iconic bricks with renewable and recycled plastic. Regardless of the upper prices, the Danish toymaker is decided to part out oil-based supplies by 2032. On high, the corporate delivered excellent double-digit top-and-bottom-line progress in H1 2024, which might speed up its swift transition into 100% sustainable bricks.
CEO Neils Christiansen revealed that,
“The company is on track to ensure that more than half of the resin it needs in 2026 is certified according to the mass balance method, an auditable way to trace sustainable materials through the supply chain, up from 30% in the first half of 2024.”
Lego’s Large Income Bounce
LEGO has achieved spectacular monetary progress within the first half of 2024, setting new information throughout the board. The corporate’s progress was pushed by sturdy demand for its numerous product vary, notably within the U.S. and Europe.
Key Monetary Highlights
- Income: Elevated by 13% to DKK 31.0 billion (from DKK 27.4 billion in H1 2023)
- Client Gross sales: Grew by 14%, outpacing the general toy trade
- Working Revenue: Up by 26% to a document DKK 8.1 billion
- Web Revenue: Up 16% to DKK 6.0 billion (from DKK 5.1 billion in H1 2023)
- Money Stream from Operations: Jumped 60% to DKK 7.5 billion (from DKK 4.7 billion in H1 2023)
- Investments: DKK 4.5 billion spent on new factories, services, and workplaces (up from DKK 3.6 billion in H1 2023)
- Free Money Stream: Elevated to DKK 3.0 billion (from DKK 1.1 billion in H1 2023)
The corporate additionally elevated its spending on sustainability, retail, and digital initiatives, making certain it stays a frontrunner within the toy trade.
Constructing Every Brick with Sustainable Supplies
From media experiences, we found that Lego has already examined over 600 supplies in its quest for sustainable alternatives to plastic. The corporate plans to scale back the oil content material in its bricks by spending 70% extra on licensed renewable resin. CEO Neils Christiansen has additionally acknowledged figuratively that this will surely enhance the price of manufacturing.
Sugarcane Based mostly Bio-PE
Since 2018, LEGO has been utilizing bio-polyethylene (bio-PE) for versatile components like flowers, botanical components, and minifigure equipment. Constituted of sugarcane sourced in Brazil, this materials is produced in a manner that aligns with WWF tips, making certain sustainability with out compromising meals safety. Immediately, over 200 completely different LEGO components are crafted from bio-PE, and almost half of all LEGO units embrace at the least one among these eco-friendly items.
ArMABS: Recycled Synthetic Marble
LEGO’s clear components, reminiscent of lightsabers, windscreens, and home windows, now comprise 20% recycled supplies from synthetic marble kitchen counter tops. With greater than 500 completely different arMABS components out there, these sustainable parts seem in over 60% of LEGO units, proving that recycling can result in crystal-clear outcomes.
Extremely Sturdy ePOM
For strong, inflexible parts like axles, LEGO is creating a brand new plastic known as ePOM. This revolutionary materials blends renewable power and CO2 from bio-waste, making it the futuristic selection for LEGO’s most sturdy components. Notably, the corporate plans to start out utilizing ePOM by 2025, marking one other step ahead in sustainability.
A Factor of the Previous: Recycled Prototype Brick
In 2021, LEGO created a prototype brick utilizing PET plastic from recycled bottles. Nonetheless, after two years of improvement, it grew to become clear that this materials didn’t obtain the carbon discount targets LEGO aimed for. Regardless of this, the undertaking supplied beneficial insights that can information LEGO because it continues to discover new supplies and enhance the sustainability of its bricks.
Curiously, these bricks are everlasting. Whether or not you obtain them years in the past or will purchase them sooner or later, all of them match collectively completely. The corporate calls this dependable connection- ‘clutch power’. Which means that each brick stacks securely, irrespective of when it was made.
No marvel these supplies meet excessive requirements for security, high quality, sturdiness and now sustainability. Moreover, the shift to greener plastic comes at a time when world toy gross sales are sluggish, with main rivals like Hasbro slicing jobs as a consequence of declining demand.
Nonetheless, with excessive gross sales quantity and robust model worth, LEGO can simply afford the manufacturing value.
Accountable Sourcing and Strategic Partnerships
Lego desires to attain net-zero greenhouse gas emissions by 2050 and reduce emissions by 37% by 2032 primarily based on 2019 ranges. Notably, it goals to take away greater than 139,000 tons of CO2e this yr. One key technique for reaching this purpose is incorporating sustainable and round supplies into all merchandise by 2032.
This entails utilizing responsibly sourced recycled supplies to reduce waste whereas making certain excessive security and high quality requirements. As an illustration, it sourced 18% of its resin beneath mass steadiness ideas in 2023.
Unlocking Lego’s Mass Steadiness Technique
Mass steadiness is a technique designed to spice up using renewable and recycled supplies in all LEGO merchandise. This mannequin entails mixing virgin fossil sources with licensed renewable and recycled inputs to create their uncooked supplies.
Supply: LEGO
By doing so, LEGO reduces its dependence on virgin fossil fuels, stimulates the market, and encourages the trade to extend the manufacturing of sustainable supplies. LEGO goals to attain Worldwide Sustainability and Carbon Certification (ISCC) Plus Certification within the first half of 2024. This world certification system covers all forms of sustainable feedstocks, together with agricultural and forestry biomass, chemical substances, plasticspackaging, bio-based supplies, and renewables.
Moreover, the corporate is working intently with suppliers, analysis establishments, and trade companions to innovate new supplies. Moreover, LEGO is exploring e-Methanol with companions like European Vitality and Novo Nordisk, with prototypes anticipated quickly, which might result in future business use.
By investing in renewable supplies, LEGO hopes to guide the toy trade towards a greener future. All in all, it’s a sensible transfer as Christiansen confidently says,
“We used our solid financial foundation to further increase spending on strategic initiatives which will support growth now and in the future to enable us to bring learning through play to even more children.”
FURTHER READING: Barbie’s $1.3B Movie and Green Shift: Hollywood Meets Sustainability
