Partner Highlight: How Michelin Leverages Searoutes for Carbon-Conscious Tendering
When most consumers hear the company name Michelin, they might immediately think about car tires. But Michelin, headquartered about 400 kilometers south of Paris, is not just a global tire producer and sponsor of professional motorsport racing. Michelin is a leader in materials science, researching and developing composite solutions and engineered polymers for use within aerospace, energy, healthcare, and other industries. The company is also involved in developing solutions for hydrogen mobility and wind propulsion for cargo shipping.
Underlying this broad reach is Michelin’s commitment to sustainability and emissions reduction, as the company realizes that these dual goals underpin much of its work in materials science. That’s why Michelin has an Intercontinental Control Tower team with the mission to ensure that intercontinental logistics operations are actively working toward a broader company initiative to reduce GHG emissions by around 28% by 2030 and achieve net-zero emissions by 2050. However, in order to meet this goal, Michelin needs to use carbon visibility to get there.
Searoutes recently sat down with Stéphane Arguedas, manager of the Intercontinental Control Tower team, to learn how Searoutes’ accurate carbon visibility APIs help Michelin to meet its sustainability targets and ship smarter, cleaner, and more efficiently. Here’s what he had to say.
The Challenge: Emissions Reduction in a Dynamic Market
One of the challenges that Michelin’s Intercontinental Control Tower team has when it comes to monitoring emissions from intercontinental logistics is navigating the disruptions and volatility that lately seem to occur more frequently. Carbon accounting must still track emissions even amid global geopolitical events affecting logistics, such as the Red Sea disruptions.
“Our main challenge is to anticipate future disruptions. A few years ago, we used to face two peak seasons during the year. Now disruptions are far more common, and the market is much more volatile due to global geopolitical events,” Stephane told Searoutes. “The other main challenge is to keep reducing emissions whilst, for example, Red Sea disruptions forcing travel around Africa go against those targets.”
Another challenge the team faces is implementing a financial framework that integrates carbon costs. The procurement process can have an indirect effect on emission reduction targets, and ideally, companies have a system in place that balances cost, service, and emissions when making freight procurement decisions.
“Our goal is to capture the specificities of all shipping needs and transmit them to procurement. Procurement does not just purchase the cheapest freight — they have to combine several imperatives such as cost, of course, service, and emission levels,” Stephane said.
“We translate those different elements into an internal financial index for lead time, for example, based on extra inventory costs or based on decarbonation solutions costs for CO2. This framework is shared and validated with other stakeholders within Michelin, including finance,” he continued. “This allows us to put a dollar value on carbon, investment value in emission-reduction endeavors, and reward tender bids objectively. This is where Searoutes comes into play. Their API feeds service-specific CO2e data to our internal procurement decision-making tool.”
Still another challenge is data quality. Carriers may potentially provide inconsistent emissions data; there can also be difficulties in standardizing reporting stemming from varying methodologies.
Seeking Accurate Carbon Accounting Data, Michelin Turned to Searoutes
To meet the three challenges mentioned above, Michelin needed a routing optimization tool that factors in lead time and CO2e data. After looking at options, Michelin decided that Searoutes’ API-driven approach was the best fit for its procurement system. That’s because Searoutes’ APIs help Michelin integrate carbon metrics into its financial index for freight procurement.
Implementing Searoutes: The Road to Cleaner Data
When Michelin received emissions data from the carriers, the team found there were some inconsistencies with some data points, such as those for freight rates, lead times, or CO2e emissions. While Michelin asked carriers to report the exact service name and its emissions per TEU, the team discovered that the input was manual most of the time and had no validation rules, according to Stephane. The team also saw that different methodologies led to significant variations in reported emissions.
“Carriers’ core business has always been maritime operations. They have varying proficiency levels when it comes to environmental impacts,” Stephane said. “Pressure from new regulations has made this a higher priority for shipping lines, but while some of them are very knowledgeable on those topics, and will go over calculation methods or frameworks, others are still learning. This translates into different methodologies and a substantial spread in reported numbers.”
But as the Intercontinental Control Tower team compared the carriers’ data against the data generated through Searoutes’ API, the team noticed the difference in data quality, Stephane said. Working with Searoutes’ APIs helped Michelin to refine carriers’ calculations and standardize emissions calculations, eventually enabling Michelin to process and clean tender data.
Michelin’s Strategy for Sustainable Shipping
To achieve the company’s sustainability targets, Michelin has developed a three axles strategy to reduce GHG emissions. Here are the three pillars:
- Ship Less: Michelin foster L2L in order to avoid transportation
- Ship Better: Michelin optimizes container utilization and reduces total ton-kilometers and activates Multi modal solution based on rail and Inland water
- Ship Different: Michelin will explore innovative solutions, like windpower mobility
Searoutes CO2 APIs cover all three of those approaches: by providing accurate, vessel-specific reporting numbers for the fewer containers being shipped, by allowing the CO2 performance to come into play during tender, and by accurately reporting the impact of innovative solutions on Michelin’s carbon footprint.
Michelin and Searoutes: A Strong Partnership for a Dynamic Future
Working with Searoutes on developing a carbon accounting methodology has resulted in a mutual learning experience between a large industrial group and an agile startup, according to Stephane.
“Our collaboration has been healthy and simple — Searoutes is able to support us and bring answers to all of our questions,” Stephane said. “We actively monitor and challenge the quality of the data being returned and so far, we have found it to be quite accurate. This is why we chose to extend our contract with a longer duration.”
He continued, “Working with startups is always something special for a large industrial group such as Michelin, which has lots of processes and documentation. We had to become more flexible, more agile, and willing to learn to change our ways. Michelin has taken a major digital turn, and this is an orientation we want to explore further.”
As Michelin and Searoutes continue the partnership, both parties will be exploring how a number of issues in 2025 will affect Michelin’s ability to reduce emissions and meet its 2030 emissions reduction target.
The issues span from complying with the European Union’s Emissions Trading System to adjusting to new ocean vessel partnerships. The impact of the maritime alliance restructuring could affect emissions and procurement strategies, while the growing role of the EU ETS could result in changes to freight cost management.
“Short term, the major 2025 reshuffling of carrier alliances brought a challenge — how the new networks will affect carbon performance remains to be seen,” Stephane said. “Measuring the impact of those greener tender allocations will also be crucial in 2025. We need to account somewhere for the emissions saved by choosing to ship on a pricier service.”
“There’s also the topic of EU ETS charges that are only getting bigger. we want to be able to challenge those charges shipment per shipment and push our computed numbers to carriers,” he continued.
Successfully Meeting Emission Reduction Goals Requires Teamwork
As Michelin pushes toward its ambitious sustainability goals — a 28% reduction in emissions by 2030 and net-zero emissions by 2050 — optimizing intercontinental logistics is crucial. However, volatile global trade conditions and inconsistent carrier-reported emissions data posed significant challenges.
By integrating Searoutes’ CO2 APIs, Michelin refined its procurement decisions, standardized emissions data, and aligned sustainability efforts with financial strategy.
Interested in learning more about how Searoutes can help your business develop and sustain an effective carbon accounting regimen? Contact us today to learn how.