These car brands have the cleanest supply chains

Among the world’s biggest car manufacturers, Tesla, Ford, and Mercedes-Benz are leading the way in eliminating emissions, environmental harms, and human rights violations from their supply chains, a new report finds.

The 2025 edition of the “Lead the Charge” study finds that automakers have made some recent improvements to their supply chains, although the authors write that the industry “still has an unacceptably long way to go”.

Even as CEO Elon Musk’s foray into politics fans a global backlash against the company, the company has overtaken Ford and moved into first place on the annual leaderboard, which is compiled by a group of organisations that includes Transport & Environment and the Sierra Club, among others.

Tesla has increased its overall score by 28 percentage points in just two years, which shows that rapid progress by automakers is possible, according to the report’s authors.

The company’s recent gains are partly thanks to its efforts to incentivise suppliers to reduce their emissions and water use and tackle deforestation.

Tesla is also the only company that discloses disaggregated scope 3 emissions for its entire steel, aluminium, and battery supply chains, and has “the most positive record on climate lobbying”. Further, the company is the leader in safeguarding the rights of indigenous people near suppliers’ mining sites.

However, Tesla performs poorly in some areas. It’s the only large Western automotive manufacturer that doesn’t have a collective agreement with its workers, and it doesn’t disclose much about its battery repurposing and recycling strategy, among other things.

And Tesla’s position in the number one spot is “precarious” because a key factor in its top score was its positive climate lobbying record. “Given reports that the company has been supporting the elimination of electric vehicle tax credits in the US, Tesla could easily fall from the top spot in next year’s edition unless it continues to maintain its strong pro-climate lobbying record.”

The report notes that across the industry, “the pace of progress will need to accelerate significantly if the auto industry is to successfully rise to the challenge ahead”. No company has achieved a total score of 50% or more.

To accelerate the rate of improvements, car manufacturers can match the best practices of their peers across different issue areas, the report says. As an example, if Tesla simply copied the best practices of competitors that outperformed it in certain areas, it could raise its overall score from 43% to at least 73%, the study says.