Climate change

The ‘Climate change’ chapter meets the disclosure requirements of ESRS E1 and is based on the results of the double materiality analysis. Material topics for the KION Group are managed in the context of the ‘Climate and energy’ action field.

Transition plan for climate change mitigation

Based on the initial climate targets in 2018 and a comprehensive revision of the climate strategy from 2021 onward, the KION Group formally committed to net-zero greenhouse gas (GHG) emissions by no later than 2050. The climate-related near-term environmental and net-zero targets were formally validated by SBTi in 2024. The KION Group does not have a finalized transition plan for climate change mitigation in place yet. The Group intends to drive forward its transition plan in 2025 by expanding on existing feasibility studies.

Material impacts, risks, and opportunities and their interaction with strategy and business model in relation to climate change

The double materiality analysis outlined in the ‘Description of the process to identify and assess material impacts, risks, and opportunities’ chapter identified the following positive and negative material impacts, risks, and opportunities in connection with climate change, including the entity-specific sub-topic ‘Energy-efficient products’.

Own production and facilities (negative impact)

The KION Group has an influence on climate change through the use of fossil fuels and purchased fossil-based energy in its own operations. This includes mobile use by company vehicles and stationary use in production and in facilities. Fossil-fuel-based energy is used in most KION Group locations, both production sites and administrative sites, for heating, cooling, electricity, process heat, and vehicles.

The scale of the impact of GHG emissions from the Group’s own operations is considered medium, with 146,554 tCO₂eq emitted in 2024 (Scope 1 and 2). The impact is widespread due to the Group’s international presence, and either difficult to reverse or only reversible over the long term due to the persistent nature of GHG emissions.

The KION Group’s business activities require energy, but it does not have to come from fossil sources. By taking the expected legal, commercial, and technological changes in the future into account, the KION Group can adapt its strategy and business model to move away from fossil fuels and the associated GHG emissions in the future.

Primary aluminum production (negative impact)

Some of the goods and components sourced by the KION Group contain aluminum. The mining and processing of primary and recycled aluminum occurs in the upstream value chain and consumes energy, generating GHG emissions as a result. The scale of the negative impact by the KION Group is considered low, based on the aluminum content in purchased goods and services in 2024. However, the impact is widespread due to the Group’s global supplier landscape, and either difficult to reverse or only reversible over the long term due to the persistent nature of GHG emissions.

Among other things, the KION Group’s business activities involve the manufacturing of material handling equipment, which entails using aluminum. The energy use and GHG emissions associated with the production and processing of aluminum are not a key element of the Group’s strategy, which would not be negatively affected by using aluminum made with low-carbon or zero-carbon technologies.

Steel production (negative impact)

Steel is an important raw material for the KION Group and an integral element in assembled parts purchased for its own production. The associated GHG emissions from steel production are generated in the Group’s upstream supply chain. The scale of the negative impact is considered medium based on the proportion of the KION Group’s GHG emissions accounted for by purchased goods and services in 2024. However, the impact is widespread due to the KION Group’s global supplier landscape, and either difficult to reverse or only reversible over the long term due to the persistent nature of GHG emissions.

The KION Group’s business activities involve manufacturing material handling equipment, which requires the use of steel. The energy use and GHG emissions associated with the production and processing of steel are not a key element of the Group’s strategy, which would not be negatively affected by using steel made with low-carbon or zero-carbon technologies.

Purchase of pre-processed parts (negative impact)

Intermediate products made from steel, plastics, electronic parts, cables, permanent magnets, screws, washers, nuts, etc. are important materials, components, and parts used in the KION Group’s production processes. These pre-processed parts cause GHG emissions in the upstream supply chain. The scale of the impact is considered high based on the large proportion of purchased goods and services accounted for by pre-processed parts in 2024. Furthermore, the impact is widespread due to the KION Group’s global customer landscape, and either difficult to reverse or only reversible over the long term due to the persistent nature of GHG emissions.

The KION Group’s business activities involve manufacturing material handling equipment, which requires the use of pre-processed parts manufactured by suppliers. The energy use and GHG emissions associated with the production and processing of pre-processed parts are not a key element of the Group’s strategy, which would not be negatively affected by using pre-processed parts made with low-carbon or zero-carbon technologies.

Business travel (negative impact)

Business travel leads to GHG emissions, with a negative impact on climate change. GHG emissions from business travel are part of the KION Group’s upstream value chain. The scale of the negative impact from the approximately 26,000 tCO₂eq of GHG emissions from employees’ global business travel in 2024 is considered low. However, the impact is widespread due to the Group’s international presence, and either difficult to reverse or only reversible over the long term due to the persistent nature of GHG emissions.

The KION Group’s business activities rely to some extent on travel, for example visiting customers and suppliers or facilitating meetings between employees from different global locations. The KION Group encourages its employees to avoid travel in order to progressively reduce the GHG emissions. This goal is supported by increasing digitalization and by networking in virtual meetings and through customer showrooms.

Transportation and logistics (negative impact)

The KION Group’s business activities rely on transporting goods between locations. GHG emissions are generated by the transportation of raw materials from suppliers to KION Group locations, and the transportation of semi-finished and finished products between KION Group locations and to customers and dealers. With estimated GHG emissions from the KION Group’s upstream transportation and distribution estimated at around 175,000 tCO₂eq in 2024, the scale of the negative impact is considered medium. However, the impact is widespread due to the Group’s extensive supplier and customer landscapes, and either difficult to reverse or only reversible over the long term due to the persistent nature of GHG emissions.

The impact of transportation and logistics is caused almost exclusively by the KION Group’s upstream value chain, as the Group operates only a small number of its own cargo vehicles that shuttle between Company locations, and commissions most transportation services from third-party providers.

Product use phase and end-of-life treatment (negative impact)

KION Group products cause GHG emissions during their use phase. While electric trucks potentially generate fewer emissions, depending on the electricity mix used, industrial trucks with internal combustion engines can be a significant source of GHG emissions, from use phase to the end of the product lifecycle. These GHG emissions contribute to climate change and its associated negative impacts. With GHG emissions from use phase and end-of-life of around 12.7 million tCO₂eq in 2024, the scale of the negative impact is considered very high. Furthermore, the impact is widespread due to the Group’s extensive global customer base, and either difficult to reverse or only reversible over the long term due to the persistent nature of GHG emissions.

GHG emissions from product use phase and end-of-life are directly related to the KION Group’s business model. Currently, every product sold and every customer project leads to GHG emissions through energy consumption during the use phase and the treatment at the end of functional life. The Group’s strategy includes both a reduction in vehicles’ energy consumption and a reduction in the number of vehicles with internal combustion engines. Furthermore, the offering of alternative drive options, such as hydrogen-powered industrial trucks, is to be expanded. Electric vehicles have the potential to be climate-friendly if operated with electricity from renewable sources.

This negative impact is directly linked to the KION Group’s business activities, but is located in the downstream value chain. The KION Group can prioritize low-GHG products in its product development and sales strategy, but it has no control over the use phase or the electricity mix of its customers.

Low-carbon products (opportunity)

A shift in customer preferences towards environmentally friendly and low-GHG products could affect demand for products and services. This could have a positive impact on the KION Group’s profitability due to higher unit sales of products with electric drive systems. This opportunity depends on shifting demand as well as on the Group’s ability to meet this demand with appropriate products and solutions.

Competitive advantage in the market (opportunity)

Rising customer demand for energy-efficient products, solutions, and services could potentially give the KION Group a competitive edge, as energy efficiency is also a key consideration in its product portfolio. This includes relevant certifications. As more businesses focus on sustainability and energy efficiency, customers are increasingly looking for products and services that are climate-resilient and can withstand the effects of extreme weather events.

Achieving legal compliance while strategically planning (opportunity)

The KION Group’s compliance and sustainability teams are working to anticipate upcoming climate change regulations and to establish resources and processes to comply with them. Insights gained through early preparation influence the Group’s sustainability strategy. Assuming that regulators and markets exert influence on one another, anticipating future compliance requirements potentially supports the Group’s ability to develop products and services which fulfill customers’ emerging climate-related demands. By closely linking legal compliance with strategic planning, the KION Group strives to anticipate and respond to emerging trends and opportunities. This could have a positive impact on its profitability due to an increase in revenue.

Cost increases due to implementation of decarbonization strategies by suppliers and monitoring of data to avoid greenwashing (transition risk)

The decarbonization of suppliers will require training, collaboration projects, changes in production technology, materials or processes, budget for data tracking tools (for example, to follow up on implemented changes and to avoid greenwashing allegations through robust data availability), and additional employees for managing the transition in the KION Group’s entire supply base. Increased costs for implementing decarbonization measures at suppliers could therefore also have a negative impact on the KION Group’s profitability.

Energy use (negative impact)

The KION Group consumes energy, mainly electricity, at all of its locations worldwide. While around 74 percent of electricity used across the Group came from renewable sources in 2024, GHG emissions from generating the purchased electricity still accounted for approximately 34,000 tCO₂eq when applying the market-based calculation method in Scope 2. In addition, the KION Group directly uses fossil sources of energy in its own operations, including diesel, gasoline, natural gas, and coking coal. Using these other energy sources generated approximately 108,000 tCO₂eq of GHG emissions in Scope 1 in 2024. While the impact of these GHG emissions is considered low, the impact is widespread due to the Group’s international presence, and either difficult to reverse or only reversible over the long term due to the persistent nature of greenhouse gas.

The KION Group’s business activities require energy, but not necessarily fossil energy. Electricity is used to power electric appliances, electric trucks, and some heating systems. Fossil fuels are used in the company’s vehicle fleet, in production processes, space heating, and cafeterias, and in its sold products with internal combustion engines, which are delivered to customers with fuel in the tank. The plan is to gradually switch most appliances currently operating on fossil fuels to electricity from renewable sources in the future. This will be implemented in line with the assets’ planned replacement cycles and according to the availability and maturity of new technologies. The switch from internal combustion to electric vehicles, for example, is intended to coincide with the renewal of leasing agreements, and will depend on how well-developed the charging infrastructure in each region is. With regulatory, market-related, and technological changes expected in the future, the KION Group’s corporate strategy and business model could fully transition away from GHG emissions linked to fossil fuels.

Global electrification of the product portfolio (positive impact)

The positive impacts of a global product portfolio electrification are directly linked to the KION Group’s future business performance, as demand for electric trucks and therefore the KION Group’s overall revenue have increased in recent years. Many KION Group products and services are available with an electric drive system and can offer the same performance as IC trucks. This has a positive impact on the product portfolio as more and more IC trucks are being replaced by electric ones.

The KION Group is committed to net-zero GHG emissions by 2050, which directly affects its strategy. Since all products in the Supply Chain Solutions segment are only available with an electric drive system, this part of the impact arises directly from the business model itself. In the Industrial Trucks & Services segment, the long-term plan is to electrify most products and solutions (for example through fuel-cell technology and other forms of electrification), creating a close connection between the impact and the ability to implement the business strategy.

This transition affects the carbon footprint of KION Group products and solutions, as energy consumed during the use phase is a significant factor in the products’ GHG footprint. If the energy used to power electric trucks comes from renewable sources, it may contribute to the reduction of GHG emissions.

Selection of materials with a high carbon footprint (negative impact)

Selecting goods and materials with a high carbon footprint can significantly impact on a product’s ecological footprint, as material consumption and purchased goods are a major contributor to GHG emissions (category ‘3.1 Purchased goods and services’). By selecting materials and goods with lower GHG emissions, it is possible to reduce the environmental footprint of KION Group products (mainly category 3.1) and the emissions from their use by customers (category ‘3.11 Use of sold products’). The KION Group has started to review the status of its product portfolio from this perspective and is working on introducing measures to optimize the materials used in its products according to their carbon footprint. This impact is directly related to the KION Group’s business activities as low-carbon and net-zero-carbon products require adjustments in product development and production, as well as in the strategic management of the supply chain.

This impact is relevant in the KION Group’s business relationships (selection of materials) upstream and downstream. In order to gain information on the GHG emissions of its upstream value chain, the Group must work closely with its suppliers. The KION Group is responsible for helping them to reduce their GHG emissions and work on alternatives that have a positive impact on the GHG emissions generated by purchased materials, goods, and services (category 3.1).

Alignment of products with sustainability efforts of customers (opportunity)

It is important for the KION Group to align its product and solution portfolio with customers’ sustainability efforts by integrating relevant requirements into the product development process, complying with industry-specific initiatives and standards, and responding to customers’ needs. Furthermore, the KION Group is focused on incorporating these insights into the development of new products and services, on complying with new regulations that affect customer needs, and on advising customers about best practice when it comes to using products and solutions (such as switching to renewable energy).

Extreme weather events in the supply chain (physical risk)

The physical impacts of climate change and the increased frequency and severity of extreme weather events (storms, floods, hurricanes) due to global warming could lead to an unstable supply chain and to material shortages, which in turn could result in disruptions in the supply chain and increased material costs for purchased goods.

Resilience of the strategy and business model in relation to climate change

In 2024, the KION Group reviewed the resilience of its strategy and business model with regard to sustainability risks using scenario analyses that included climate risks. The analyses covered all areas of the value chain (see ‘Material impacts, risks, and opportunities and their interaction with strategy and business model’)

Based on a net-zero scenario in line with limiting global warming to 1.5° Celsius, the analysis assumed that there will be a shift in demand from higher-emission to lower-emission products and services as customers seek to reduce their GHG footprint. However, the speed at which this shift takes place will vary from one region of the world to another. As a consequence, a diversified product portfolio will be needed to meet customer demands at different stages of climate transition. The analysis also assumed that internal combustion engines will be banned in certain countries, while production and sales will remain possible in other regions. These assumptions are reflected in the KION Group’s strategy to offer a broad product portfolio of vehicles with high-efficiency internal combustion engines and drives that run on alternative fuels, while simultaneously pressing ahead with the electrification of the entire range.

The resilience analysis used the International Energy Agency’s Announced Pledges Scenario (APS) and a net-zero scenario to estimate the development of energy markets. The APS was chosen as a more conservative approach, not focused on a 1.5°C target, to assess the impact of energy-related emissions in the event that the world’s leading regions are not ambitious enough in setting targets for their energy systems in the coming years. These estimates interact with the KION Group’s goal of achieving net-zero GHG emissions by 2050 at the latest, which depends to a large extent on the availability of low-emission energy in the products’ use phase. The APS was also used to estimate carbon prices, which in turn influence the decision to invest in low-carbon technologies in the Group’s own operations.

It was presumed, based on the assumptions of carbon costs and the availability of low-carbon energy, and in line with the KION Group’s decarbonization targets, that currently existing and emerging technologies will be available to the extent and at the cost required to meet the Group’s Scope 1 and 2 targets by 2030. This applies to fuel consumers in own operations, including the Group’s vehicle fleet and foundries. Assumptions were also made regarding the availability and cost of raw materials with a low GHG footprint, particularly steel products, by 2050.

Raw materials and components are a major source of GHG emissions in the KION Group’s upstream value chain. The transformation required in the industry to supply low-carbon alternatives is still at an early stage, and therefore the market volumes are limited compared to what is required.

The resilience analysis of the KION Group’s strategy and business model included transition scenarios up to 2030, 2040, and 2050, as well as anticipated financial effects, in line with the near-term and long-term decarbonization and reduction targets set.

The transformation of the industry is expected to generate high demand for low-carbon alternatives, such as green steel, and increase competition. As a consequence, the prices of low-carbon alternatives could rise significantly in the short and medium term. By focusing on reducing the energy consumption of sold products (category ‘3.11 Use of sold products’) and shifting to a broadly electrified product and solution portfolio as part of the short-term strategy, the KION Group is addressing net-zero requirements while remaining competitive and developing capacity and robust structures in the supply chain.

[[To assess the vulnerability to physical climate risks, scenarios with high emissions, including RCP 8.5, were taken into account in order to model acute and chronic location-specific climate risks.]]

There is a degree of doubt in the resilience analysis due to uncertainties in the underlying data and models. Assumptions about future carbon prices and technologies will influence the planning of investments in low-carbon technologies, while technological changes affecting energy consumption and the energy mix will influence the anticipated reduction in emissions during the use phase of KION Group products.

In its strategies, investment decisions, and climate change mitigation activities, the KION Group addresses business activities that are not compatible with a net-zero target, e.g., the manufacture of vehicles with internal combustion engines, by taking appropriate action to improve their performance and climate impact. At the same time, it is focusing its business on activities that are compatible with the targets set. This two-pronged approach allows the Group to align its business strategy with climate targets while making the transition financially viable.

The results of the analysis were positive with regard to the KION Group’s ability to adapt its business model to climate change. Feasibility studies were conducted up to mid-2024 to assess the necessary action to achieve GHG reductions in line with net-zero requirements. The feasibility studies showed only a limited need for investment, based on the assumption that the ability to achieve climate targets will help the KION Group to secure finance on favorable terms.

To ensure the highest level of transparency and comparability, the KION Group uses the widely adopted international disclosure and scoring platform CDP in order to publicly communicate its GHG management and the progress made against targets since 2017.

Policies related to climate change mitigation and adaptation

The following subchapters deal with the KION Group’s material strategic priorities in relation to climate change mitigation.

Commitment to net zero and the Science Based Targets initiative

Through its explicit commitment to achieving net-zero GHG emissions along the entire value chain by no later than 2050 and setting appropriate strategic climate targets, the KION Group strives to align its targets with the goal of the Paris Climate Agreement to limit global warming to 1.5°C. The SBTi used its own net-zero standard to formally validate the KION Group’s climate targets in 2024. This standard sets the minimum ambition for climate change mitigation, to which the KION Group is committed and which it has enshrined in its sustainability strategy. Energy efficiency and the use of renewable energy are elements of the roadmap toward net zero.

The commitment to SBTi covers the Group’s Scope 1, 2, and 3 emissions, including the entire value chain, the Company’s products and solutions, and the energy used in its own operations. Responsibility lies with the Executive Board of KION GROUP AG, in particular with the CPSO. The targets are assessed regularly (at least once a year) as part of strategy reviews, internal target setting, and progress monitoring. Progress on climate targets, action taken, and GHG emissions is reported publicly at least once a year. The KION Group’s commitment to the SBTi is available to the public at www.sciencebasedtargets.org/companies-taking-action and is communicated to the Company’s employees and to customers and suppliers.

The commitment to net zero mainly affects the KION Group’s employees, suppliers, customers, investors, and other stakeholders. Employees provided input and feedback on the feasibility of targets when defining the commitment. They also suggested schedules for implementation and supported the planning of each initiative. Customers and investors expressed their expectations – as part of regular stakeholder dialogue or in the context of materiality analyses, for example – of the KION Group’s climate-related targets and performance.

In addition to the ‘Climate change mitigation’ subtopic, the commitment to the net-zero target and Science Based Targets initiative addresses aspects of climate change adaptation. Beyond this, no specific policy for the ‘Climate change adaptation’ sub-topic was in place in the upstream value chain at the end of 2024. The Group intends to formulate a policy from 2025 onward based on the results of future risk analyses.

Health, Safety, and Environment Statement of Intent

Particularly worth highlighting in the context of climate action is the Health, Safety, and Environment (HSE) Statement of Intent’s ambition to use fewer natural resources and energy, generate less waste, and reduce the Group’s own operations’ emissions in air, land, and water. This policy is linked to climate change mitigation as it aims to reduce emissions, such as greenhouse gases, into the air and the consumption of natural resources, including for power generation.

The policy covers Scope 1 and 2 emissions without alternatives. However, Scope 3 emissions are not within the scope of this policy. Responsibility lies with the Executive Board of KION GROUP AG, in particular with the CPSO. Data on energy use, GHG and pollutant emissions, and waste generated is published every year.

The HSE Statement of Intent is binding for the entire KION Group, including employees, contractors, and agency workers. The policy was developed by involving employees via representatives (OU HSE heads), while other stakeholder groups were taken into account through their respective departments. The HSE Statement of Intent is reviewed regularly, and at least annually, by Corporate Sustainability & HSE and other relevant stakeholder functions.

The policy is provided to employees during their induction, displayed on the organization’s notice boards, and communicated via the intranet. A copy of the policy statement must be made available upon request to any employee, customer, contractor, auditor, or regulatory authority.

[[The HSE Statement of Intent is also available to the public on the KION Group’s website via www.kiongroup.com/sustainability.]]

Strategic focus on increasing the proportion of renewable energies

Increasing the proportion of renewable energy helps to reduce Scope 1 and 2 GHG emissions and is thus linked to climate change mitigation and energy use. The KION Group has pursued this strategy since 2023 and aims to increase the proportion of renewable energy in the total energy used in the Group’s own operations and at its sites within Scope 1 and 2. The annual publication of data on energy consumption and GHG emissions is overseen by the CPSO (see ‘Strategy targets and target achievement in 2024’)

This strategy affects the KION Group’s employees, suppliers, customers, and investors. The input and feedback of employees on the feasibility of targets, including suggested schedules for implementation and support for initiatives, was taken into account during development. Customers were indirectly involved in enshrining this approach in the strategy. [[Further information on the strategy is available to the public on the KION Group website at www.kiongroup.com/sustainability/ and is communicated internally to employees.]]

The product development process in the Industrial Trucks & Services segment

The Innovative Product Evolution Process 2 (iPEP 2) is a framework for product development along the entire value chain in the Industrial Trucks & Services segment. Key elements are the definition of roles and process architecture, integrated project planning, and a shared glossary. The main idea is to tailor the process to a specific project. Every project has specific parameters and requirements, such as the need for sustainability, that must be taken into account in project management.

The Chief Technology Officer (CTO) on the Executive Board of KION GROUP AG is responsible for iPEP implementation. The policy undergoes regular internal checks through which requested changes are approved, rejected, or revised. After approval, all changes undergo the same implementation phase, during which they are tested, communicated, and released into the process.

The policy mainly affects product development, but other functions such as product management, quality assurance, operations, procurement, controlling, and service are also involved. It was developed with input from all affected stakeholders and underwent a process evaluation as part of the KION Product Development Optimization change initiative. Every iPEP user can request changes and a review of the process, which is then evaluated according to the proposed change. The policy is available on the intranet and communicated to the workforce by the communications department.

Actions and resources in relation to climate change policies

With regard to its Scope 1 emissions, the KION Group began to progressively replace internal combustion vehicles with electric vehicles in its fleet of company cars and service vehicles in 2023. This action is expected to be completed by 2040. This links to the commitment to the net-zero targets, the SBTi targets, and the targets for absolute GHG reduction. The Group intends to press ahead with its transition plan in 2025.

A progressive electrification of the fleets of company cars and service vehicles is not feasible across the entire Group due to country-specific restrictions such as supply bottlenecks in vehicle production and inadequate charging infrastructure. As a result, the KION Group subsidiary in Brazil started to switch to bioethanol as a short-term solution for reducing GHG emissions from gasoline consumption. This action is linked to the strategic targets of the ‘Climate and energy’ action field to increase the proportion of renewable energy used and achieve an absolute reduction in GHG emissions for the Group. In the context of Scope 1 GHG emissions, this represents a decarbonization lever through the use of renewable energy sources in own operations. The subsidiary plans to further increase the proportion of bioethanol in its fuel consumption in 2025.

More than 74 percent of the electricity purchased by the KION Group in 2024 already came from renewable sources (green electricity, Scope 2). Due to the organization’s global footprint and the large number of sites, sourcing green electricity through power purchase agreements (PPAs) or local retail renewable PPAs is not always feasible. The KION Group therefore plans to gradually improve transparency by purchasing energy attribute certificates (EACs) to achieve 100 percent electricity from renewable sources at all its locations, and thus reduce Scope 2 emissions by increasing the proportion of renewable energy. The ultimate goal is to completely switch to green electricity by 2030. This action is at the planning stage and is expected to start in 2025.

In the context of the ESRS disclosure requirements for contractual instruments for the sale and purchase of energy, these only applied to electricity for the KION Group.

Furthermore, the Group is pursuing the ambition to ensure that its suppliers can also meet SBTi decarbonization targets by 2029. In total, at least 5 percent of the Group’s emissions from purchased goods and services are generated on the supplier side. The active involvement of suppliers and the corresponding actions are linked to the commitment to net-zero targets and SBTi targets, and to the guidelines on climate change mitigation that apply to suppliers. A base year of 2023 was set for these targets.

Actions related to energy-efficient products (entity-specific)

The KION Group is working on collecting supplier-specific data in order to improve the underlying data. With this in mind, it launched a project in March 2024 aimed at reducing emissions in procurement, which relates to the entity-specific ‘Energy-efficient products’ sub-topic. The project is designed to help the global procurement team to reduce greenhouse gas emissions in category ‘3.1 Purchased goods and services’ by evaluating, analyzing, and actively reducing GHG emissions of purchased goods and services. The focus is on direct tier 1 suppliers worldwide in the KION Group’s upstream value chain. These are suppliers who have a direct business relationship with a KION Group entity. Direct suppliers are those who supply materials used in KION’s products.

The project includes the following milestones: analyzing previous GHG emissions, conducting a feasibility study for a net-zero target by 2050, creating structures and processes that enable the procurement team to consider GHG emissions in its decisions, and conducting pilot supplier workshops to understand their climate-related ambitions. Furthermore, the selection of a suitable software tool for managing GHG emissions is to be supported.

Teams of lifecycle assessment (LCA) experts assist the affected internal stakeholders. New insights based on the findings of the LCAs can then be integrated early on during the design phase. Online training sessions on LCAs come under the company-specific topic of energy-efficient products. Several extended online training courses on this topic were conducted with external partners in 2024 to provide the relevant employees with the necessary knowledge and skills to make informed decisions based on lifecycle assessments. The sessions in 2024 covered theoretical and practical aspects of LCAs and were targeted at a broad audience, from managers to technicians across a wide range of departments. The employees learned what an LCA is and how it can be best used for projects and design evaluations to support general decision-making regarding the sustainability aspects of KION Group products. This is especially important for research and development (R&D).

Working with an external provider, the KION Group conducted a series of workshops in 2024 on the company-specific topic of energy efficient products, in line with the Cradle-to-Cradle principle and relevant categories. They were designed to give the KION Group’s sustainability experts the knowledge they need so that they can concentrate on their activities connected to the Cradle-to-Cradle certification. The workshops were targeted at a broad audience, from managers to technicians, with the aim of increasing skills in this area.

The KION Group’s decarbonization levers

Switching to alternative fuels is the key decarbonization lever in the KION Group’s own operations. Diesel and gasoline consumption in the vehicle fleet (mainly company cars and service vehicles) accounts for a large proportion of energy consumption and emissions in the Group’s own operations. By switching its fleet to electric, the KION Group can benefit from electric vehicles’ lower energy consumption, and switch to electricity from renewable sources to further reduce GHG emissions from transportation.

Another source of fossil GHG emissions are the KION Group’s two foundries, which use coking coal. The KION strategy includes replacing the coke-powered furnaces with electric arc furnaces. Natural gas consumption for space heating and process heat, such as the ovens used in manufacturing, can be addressed by switching to technologies such as heat pumps for space heating and electric ovens in manufacturing.

Combined with fuel switching, the use of renewable energy is another key decarbonization lever for the KION Group’s business activities. The proportion of renewable energy used in the Group in 2024 was 21 percent. And the proportion of renewables in total energy consumption can be significantly increased through the electrification of processes for which alternative technologies are potentially available. Where electrification is not feasible in the medium term, alternative renewable fuels such as bioethanol or green hydrogen could provide an alternative.

Emissions from the product use phase in the Industrial Trucks & Services segment accounted for more than 66 percent of the KION Group’s total GHG footprint in 2024. Although the proportion of sold vehicles with internal combustion (IC) engines was only 8 percent, the GHG emissions from their use phase amounted to over 35 percent. Further reducing the proportion of IC vehicles will help to reduce GHG emissions meet the Group’s climate targets.

More than 50 percent of the KION Group’s total GHG emissions in 2024 were attributed to the use phase of electric products and solutions sold to customers. In order to reach the net-zero target, it is necessary to address these emissions too. The corporate strategy therefore involves increasing the energy efficiency of products by improving battery technology and using high-efficiency batteries, such as lithium-ion cells, to reduce energy consumption Furthermore, the KION Group is working closely with its customers to increase the proportion of renewables in their electricity mix.

‘Purchased goods and services’ (category 3.1) represented 20 percent of the KION Group’s total GHG emissions in Scopes 1 to 3 in 2024. As part of its overall decarbonization strategy, the Company plans to work with its suppliers on reducing GHG emissions. This includes increased material efficiency, switching to alternative materials, increased use of recycled materials, and technological solutions to decarbonize production processes for energy-intensive products like steel. Further details can be found in the ‘Actions related to energy-efficient products (entity-specific)’ chapter. Beyond this, the KION Group had not implemented a specific policy for the ‘Climate change adaptation’ sub-topic in the upstream value chain at the end of 2024.

In 2024, the KION Group had only minimal capital expenditure and operating expenses in connection with actions and policies relating to climate change. The assumption is that significant expenditure will be necessary to achieve the targets relating to climate change mitigation and climate change adaptation. The relevant planning process for this is currently still at the implementation stage. In 2025, the KION Group intends to define in greater detail the investments in, and expenditure on, climate change mitigation in its transition plan, and follow that up with detailed reporting. The plan will also close any gaps in policies and actions relating to identified impacts, risks, and opportunities.

Targets related to climate change mitigation and adaptation

The KION Group calculates and controls its GHG emissions based on the international Greenhouse Gas Protocol (GHG Protocol). Where it is technologically possible, the GHGs covered are carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride, and nitrogen trifluoride.

The GHG Protocol includes an option, in the attribution of emission sources and company thresholds to the direct and indirect GHG emissions categories in Scope 1, 2, and 3, to determine beneficial ownership on the basis of operational control. The KION Group has taken an operational control approach for years and attributes indirect GHG emissions generated during the use of products, including those leased downstream over which the KION Group retains beneficial ownership (financial control) as the lessor (operating lease agreement), to the GHG emissions in Scope 3. The main factors influencing these GHG emissions, such as the type of product, the way and extent to which it is used, and the electricity mix powering electric products, lie outside of the KION Group. The Group therefore believes that the quantification and control of these GHG emissions differs significantly from the way in which GHG emissions included in Scope 1 and 2 are quantified and controlled. The classification of operating leases in Scope 3 is thus the same as for lease business in which the customer takes beneficial ownership (finance lease), and for sold products and solutions that are recognized over their entire lifetime in the combined category ‘3.11 Use of sold products’, which includes category ‘3.13 Downstream leased assets’.

Unlike the KION Group’s chosen approach of operational control in accordance with the GHG Protocol, ESRS follows the principle of financial control and the importance of beneficial ownership. Changing the classification of lease business from operating leases to align with ESRS would result in significant adjustments to the KION Group’s existing sustainability strategy.

Given the abovementioned climate targets, in particular the net-zero target, the disclosures on target achievement, and the formal validation by the SBTi in 2024, the KION Group has decided to deviate from ESRS 1.62 and the principle of financial control. Instead, the Group will persist with the approach of operational control and, in accordance with the GHG Protocol, continue this method of reporting consistently in this Group sustainability report.

All of the abovementioned GHG targets are gross targets and do not include negative GHG emissions, carbon offsetting, or GHG emission avoidance as a means of achieving GHG emission reduction targets. Starting from the base year of 2021, the GHG emission reduction targets aim to limit global warming, on a cross-sector pathway, to 1.5°C compared with pre-industrial levels. The assessment excludes any GHG emission reductions before 2020. The KION Group considered a net-zero scenario as well as one based on pledges announced to date.

Absolute reduction targets for Scope 1 and 2

The KION Group has set itself the target of reducing Scope 1 and 2 GHG emissions by at least 90 percent by 2050, starting with 2021 as the base year (baseline value: 149,359 tCO₂eq). The near-term target for 2030 is an absolute reduction by 42 percent. The baseline for the Scope 1 and Scope 2 reduction target relates to GHG emissions from direct and indirect energy consumption in own operations. Emissions from customers’ use of leased products over which the KION Group retains beneficial ownership (financial control) as the lessor (operating lease agreements) are classified as Scope 3 emissions in line with the operational control approach of the GHG Protocol, and are thus not part of the reduction target for Scope 1 and 2.

The target has a scientific basis and covers all Scope 1 and 2 emissions that are under the operational control of the KION Group within the meaning of the GHG Protocol. For the purposes of setting and achieving targets for GHG emissions, the KION Group uses the market-based method as the basis for the calculated Scope 2 GHG emissions. The KION Group set the target using the SBTi net-zero framework and the detailed methodology sheets. The Science Based Targets initiative (SBTi) is an organization that helps companies to set climate targets. The goals set by the Science Based Targets initiative are widely accepted and considered to be grounded in climate science. The SBTi’s methodology is subject to inherent uncertainties with regard to the underlying research findings and forward-looking assumptions about the reduction of greenhouse gas emissions needed to achieve the 1.5°C target. The SBTi methodology, which was published in 2021, is currently being revised. New research-based insights into the progress of climate change could lead to a revision of the SBTi methodology and of the assessment whether the target levels are sufficient to limit global warming to 1.5°C. The KION Group will adjust its target if the SBTi methodology changes.

The target was formally validated by SBTi in 2024. When defining the basic assumptions for GHG emission reduction targets, the KION Group considered future developments that could potentially influence its GHG emissions and its efforts to reduce them: Company growth and a rise in unit sales would lead to an increase in energy consumption and emissions along the value chain. The switch to electric vehicles, the decarbonization of global electricity grids, rising carbon taxes, and the availability of technologies such as green steel and electric arc furnaces would help the KION Group to reduce the emission intensity of its activities.

The KION Group has taken the following actions to ensure that the baseline value is representative:

• The KION Group used emission factors from the same sources. Where methodologies or emission factors were changed, the base year was recalculated using the same methods.
• Adjustments to the organizational boundaries accounted for less than 5 percent of changes in the GHG inventory.
• The base year of 2021 is considered representative for the KION Group’s business activities in the years since. This was formally validated in the SBTi’s assessment of the reduction targets.

With regard to sustainability matters prior to 2030, the same base year of 2021 is used for comparative analyses. The KION Group will choose a base year no more than three years before the first reporting year of the new target period when defining new targets. From 2030 onward, the Group will update its base year every five years.

Absolute reduction target for Scope 3

The KION Group’s absolute reduction target for Scope 3 emissions was set using the SBTi methodology. It envisages a reduction of at least 25 percent in category ’3.11 Use of sold products’ by 2030, and of no less than 90 percent across Scope 3 by 2050. According to the operational control approach, category 3.11 includes GHG emissions generated during the use of products leased downstream as part of the KION Group lease business. The base year is 2021 with a baseline value of 19,764,107 tCO₂eq. The SBTi formally validated 2021 as the representative base year for the KION Group, based on historical data and expected future growth. The target covers 100 percent of the KION Group’s Scope 3 emissions for the net-zero target and 83 percent of Scope 3 emissions for the near-term target which covers category 3.11. If the SBTi methodology is updated, the KION Group agrees to adjust its target accordingly. Affected stakeholders were involved in setting the target. Customers and investors were interviewed about their expectations regarding the KION Group’s climate targets, while internal stakeholders were consulted about the feasibility and timeline of necessary action.

Currently, the Group is pursuing the strategic objectives of conducting more lifecycle assessments for products and obtaining Cradle-to-Cradle certificates for selected products. LCAs are an essential source of information used to define GHG emission reduction targets as part of the KION Group’s commitment to the SBTi framework. They provide an overview of the environmental impact of KION products, including their carbon footprint. This kind of information is increasingly requested by customers and essential when it comes to countering the negative impact of selected materials on the environment.

The KION Group is currently following the Cradle-to-Cradle processes with the aim of obtaining the Environmental Protection Encouragement Agency (EPEA) certificate. A Cradle-to-Cradle analysis complements the LCA by assessing the effectiveness of processes in terms of their sustainability. It assesses the safety, circularity, and sustainability of a product across five categories with regard to sustainability performance. Furthermore, implementing the Cradle-to-Cradle framework into its processes should help the KION Group to align its products with the sustainability efforts of its customers.

The KION Group’s two strategic objectives relating to LCAs and cradle-to-cradle certifications form the basis for the development of targets directly linked to the IROs in question. The plan is to define specific metrics and targets for them by the end of 2025.

No target was defined for the ‘Climate change adaptation’ sub-topic in 2024 in relation to Scope 3 GHG emissions in the upstream value chain.

Proportion of electric vehicles sold annually (Industrial Trucks & Services segment)

The KION Group plans to establish a portfolio focused on electric drive systems, including battery-powered and fuel cell-powered products, by increasing the proportion of electric vehicles sold annually. Given the positive trend, starting from a base year of 2019 and a baseline of 85 percent, the KION Group decided to increase the previous target from 90 percent to 92 percent by 2027.

The target is calculated as the proportion of electric products (including fuel cells and other electric technologies) ordered annually in the Industrial Trucks & Services segment (in terms of units in new business).

This target relates to the GHG emission reduction target in the KION Group’s commitment to the SBTi framework, and to the IRO ‘Global electrification of the product portfolio’. The target was defined in collaboration with the relevant departments and Operating Unit representatives who are responsible for the ‘Product and solution sustainability’ action field. The adjusted target was then approved by the Executive Board of KION GROUP AG.

Metrics related to climate change

In the context of climate change, the metrics for energy consumption, energy mix, and energy intensity, the metrics for greenhouse gas emissions, and the entity-specific metrics for energy-efficient products are presented below. The methods and significant assumptions are explained in this context, as are, where appropriate, the estimates and outcome uncertainties. Furthermore, information is disclosed on greenhouse gas removal, on greenhouse gas reduction projects financed through emission allowances, and on internal carbon pricing.

Metrics on energy consumption, energy mix, and energy intensity

Energy-related metrics are determined in the same way as GHG emissions. Energy data for the KION Group’s own activities is primarily calculated and controlled in line with the definition of the Company for the purposes of calculating GHG emissions in accordance with the GHG Protocol and the operational control approach. The energy consumed in the reporting year by products leased downstream over which the KION Group retains beneficial ownership (operating lease) is not included in the Company’s own energy consumption. This definition, which is comparable to the approach for GHG emissions, is in line with the attribution of energy consumption in the KION Group that is relevant to climate targets and the commitment to SBTi.

To calculate energy data, the KION Group uses conversion factors in the latest version of ‘UK Government GHG Conversion Factors for Company Reporting’ (Department for Environment, Food & Rural Affairs, DEFRA). The factors used were selected due to their scientific basis, reliability, and widespread acceptance in international reporting standards.

To determine energy intensity in climate-intensive sectors according to ESRS, the NACE classification system was used to identify the energy intensive sectors of relevance for the KION Group. Entities in the KION Group were assigned the relevant NACE Codes. The KION Group operates in the following energy-intensive sectors according to ESRS, which were included in the calculation of energy intensity:

• NACE Code 46 Wholesale trade, except of motor vehicles and motorcycles
• NACE Code 28 Manufacture of machinery and equipment n.e.c.
• NACE Code 52 Warehousing and support activities for transportation
• NACE Code 27 Manufacture of electrical equipment

Metrics on greenhouse gas emissions

GHG emissions for Scope 1, Scope 2, and Scope 3 are always calculated in line with the standards of the Greenhouse Gas Protocol. The calculation takes entities under financial control into account, including financially immaterial subsidiaries and those under operational control.

The subsidiaries’ greenhouse gas emissions are recorded, reported, and reviewed annually while taking the threshold values set at Group level into account. This review is based on the scope of consolidation for financial reporting, including the subsidiaries classified as financially immaterial, and the criteria for operational control. Compared with 2023, there are no material changes in the definition of the KION Group business units to be included or its upstream and downstream value chain for 2024.

When calculating or reporting greenhouse gas emissions, the KION Group does not use any information from entities in its value chain that have a different reporting period.

The KION Group primarily calculates and controls GHG emissions in accordance with the GHG Protocol and the operational control approach. For the reporting year, GHG emissions from the use of products leased downstream over which the KION Group retains beneficial ownership (operating leases) are recognized in full as indirect GHG emissions for the entire lifecycle in the year the order was placed, together with other products and solutions sold, in category ‘3.11 Use of sold products’ in combination with ‘3.13 Downstream leased assets’, and in ‘3.12 End-of-life treatment of sold products’. This approach is in line with the KION Group’s commitment to SBTi.

According to ESRS 1.62, the principle of financial control must be followed. The KION Group decided to deviate from ESRS when it comes to leased property, plant and equipment over which the Group retains beneficial ownership (operating lease) during the term of the lease. Under the principle of financial control, the energy consumed and greenhouse gases emitted during the use of assets leased downstream would have to be recognized by the KION Group under Scope 1 and 2. However, since it is the customers that have operational control, there is a significant difference to the energy consumed and greenhouse gases emitted in the Group’s own operations in terms of their origin and the ability to measure and control them. They are indirect in nature from the Group’s perspective. Furthermore, period-specific shifts and adjustments to indirect GHG emissions would arise in categories ‘3.3 Fuel and energy-related emissions’, ‘3.11 Use of sold products’ (respectively ‘3.12 End-of-life treatment of sold products’ and ‘3.13 Downstream leased assets’). For this reason, the KION Group is following the operational control approach.

Scope 1 greenhouse gas emissions

Emissions from stationary combustion, such as through the use of heating systems, process heat, furnaces, and generators, are calculated on the basis of the amount of fuel consumed.

GHG emissions from mobile combustion result from the fuel used by KION vehicles and forklift trucks on the KION Group’s sites. Emissions are calculated based on the volumes of fuel recorded.

To calculate GHG emissions in Scope 1, the KION Group uses the latest version of ‘UK Government GHG Conversion Factors for Company Reporting’ (Department for Environment, Food & Rural Affairs, DEFRA) to obtain conversion and emission factors. The emission factors used were selected due to their scientific basis, reliability, and widespread acceptance in international reporting standards.

Scope 2 GHG emissions

Scope 2 GHG emissions are calculated on the basis of the purchased electricity, heat, and cooling consumed at production sites and in administrative buildings. The KION Group reports Scope 2 GHG emissions under the location-based and the market-based approach.

Location-based emissions are calculated on the basis of average regional emission factors from the ecoinvent database. Market-based GHG emissions are calculated on the basis of contracts and information from suppliers about emissions. At sites with power purchasing agreements and guarantees of origin, the specific energy sources are used. Otherwise, the data is based on supplier-specific information from power purchasing agreements. In a few cases, no information on energy sources is available, so information on the residual electricity mix at the site is used. This is based on data from the European Residual Mix, published by the AIB (Association of Issuing Bodies), and emission factors from the ecoinvent database, which provide detailed information on the composition of regional energy mixes. The KION Group uses the latest version of DEFRA’s emission factors to calculate GHG emissions from purchased heat. The emission factors used were selected due to their scientific basis, reliability, and widespread acceptance in international reporting standards.

Significant Scope 3 GHG emissions

The KION Group carried out a GHG materiality analysis to determine the relevant Scope 3 categories. This analysis is updated in the event of significant organizational changes and is carried out in accordance with the KION Group’s internal guidelines for calculating emission data. The following categories are not currently considered in detail in the calculation of Scope 3 GHG emissions, as they were not deemed material: ‘3.8 Upstream leased assets’, ‘3.9 Downstream transportation and distribution’, ‘3.10 Processing of sold products’, and ‘3.14 Franchises’. The category ‘3.13 Downstream leased assets’ is not disclosed separately; instead, it is reported, together with sold products and solutions over the entire lifetime, in category ‘3.11 Use of sold products’ using the same calculation method.

The GHG emissions in categories ‘3.1 Purchased goods and services’ and ‘3.2 Capital goods’ mainly stem from the sourcing of steel and steel constructions, batteries and chargers, engines and generators, industrial trucks, chemicals, lubricants, and industrial gases (category 3.1) as well as machines, building constructions, hardware, equipment, and facilities (category 3.2). An internal database, which directly interfaces with the KION Group’s accounting system, is a central source of data. It tracks spending on purchased goods and services, capital goods, transportation, and leased assets. For category 3.1, only spending on purchased goods and services is taken into account, whereas category 3.2 covers spending on capital goods. As the internal database does not cover the entire KION Group, estimates are made for these entities in order to calculate the GHG emissions. In addition, the months from October to December are extrapolated on a linear basis using the actual data up to September in each year. Emissions are also determined based on expenditure. The KION Group obtains the emission factors from a specialist provider to ensure that the data is up to date and offers a high degree of geographical and sector-specific detail. The KION Group is working on successively collecting supplier-specific data in order to improve the underlying data for key areas of spending. The ‘cradle-to-gate’ methodology is applied in respect of GHG emissions included in the calculation.

The GHG emissions under category ‘3.3 Fuel and energy-related emissions’ were calculated using energy consumption data for each entity. The same data serves as the basis for calculating Scope 1 and 2 GHG emissions. For direct energy sources, emission factors from the UK’s Department for Environment, Food and Rural Affairs (DEFRA) were used in order to calculate upstream emissions. For upstream emissions from purchased indirect energy (electricity, heating, cooling) and for transmission and distribution losses, country-specific ecoinvent emission factors were used.

The GHG emissions reported under category ‘3.4 Upstream transportation and distribution’ are mainly gleaned from general logistics, road transportation, intralogistic services, and storage. They are calculated using a spend-based approach, as described in connection with category ‘3.1 Purchased goods and services’. The internal database is also the main source of information here, as it tracks spending on transportation, goods and services, capital goods, and leased assets, taking account of the emission factors obtained from a specialist provider. Estimates are made on the same basis as for category 3.1. Only the transportation emissions arising from inbound and outbound transportation (well-to-wheel) in connection with transportation activities carried out and paid for by the KION Group in 2024 are reported on this basis.

The calculation under category ‘3.5 Waste from own operations’ is based on entity-specific waste data from Group sites, broken down by waste category and recycling rates. Non-recycled materials were calculated using emission factors from the ecoinvent database, which entail assumptions about the treatment of waste. The calculation does not include emissions from the recycling process.

The calculation in category ‘3.6 Business travel’ is based on the actual distance traveled and the mode of transportation, or, if that information is not available, on spend data. The required information is submitted by various travel providers and aggregated centrally by the KION Group. Any missing data from individual Operating Units was extrapolated on the basis of headcount. The emissions comprise all relevant greenhouse gas emissions during transportation. They are calculated using the well-to-wheel approach. Emissions from hotel stays are outside the minimum boundary and are not reported under category 6. The emission factors from ‘UK Government GHG Conversion Factors for Company Reporting’ (DEFRA) were adjusted for inflation and also adjusted using inflation rates and exchange rates for Europe from Statista.

Emissions in category ‘3.7 Employee commuting’ were calculated for each region based on the number of employees at the end of the financial year (headcount). The following regions, in which there are sites, were included in the calculation: western Europe, eastern Europe, Middle East and Africa, North America, Central America, South America, China, and the APAC region excluding China. Assumptions were made about the mode of transportation (car, ride sharing, public transportation, bicycle, walking) and average distance commuted. The emissions were calculated using the emission factors from ‘UK Government GHG Conversion Factors for Company Reporting’ (DEFRA) and the well-to-wheel approach. Emissions include all relevant greenhouse gas emissions that arise from vehicle use by employees while commuting. Emissions from remote working are below the minimum boundary and are not reported under category 7.

GHG emissions in categories ‘3.11 Use of sold products’ and ‘3.13 Downstream leased assets’ are calculated separately for the Industrial Trucks & Services and the Supply Chain Solutions segments. In the Industrial Trucks & Services segment, information on the energy consumption of forklift trucks and warehouse trucks is taken, for example, from product specifications given to customers and from internal sources and calculations. The number of trucks recorded in 2024 is based on the number of industrial trucks ordered, which are logged every month in the Industrial Trucks & Services segment for the World Industrial Truck Statistics (WITS) statistics. As neither the statistics nor the intern available information on order intake differentiate between sold assets and those leased downstream, the KION Group discloses the GHG emissions from both categories collectively in category 3.11. This is based on the assumption that there is no material difference in the way that sold trucks and leased trucks are used. For the Supply Chain Solutions segment, a revenue-based calculation model is used in the form of a reference approach. An average energy intensity (estimated energy over the lifetime of solutions per euro of revenue based on reference prices) was calculated in order to determine the GHG emissions on the basis of anticipated achievable revenue. The objective is to account for the complexity and individual nature of each project, which currently prevent the use of a standard method of calculation. The reference model was developed with the aid of an internal calculation tool that is used during the tendering process to estimate a facility’s energy consumption with the help of customer specifications, empirical values, and scientifically based technical parameters. This involves identifying from the agreed facility layout which conveyor assets are used in which specifications, and calculating the resulting energy consumption over the lifetime and, based on the associated price structure, relating it to revenue.

The GHG emissions in category ‘3.11 Use of sold products’ were calculated using the emission factors from ‘UK Government GHG Conversion Factors for Company Reporting’ (DEFRA) for vehicles with internal combustion engines, and the ecoinvent database for electricity consumption during product use. Geo-specific emission factors were used to take the end customer’s electricity mix into account (location-specific). The products of the KION Group are sold or initially leased, but are recognized together as the estimated GHG emissions from the use of sold or initially leased products are the same. All emissions from the use of sold or leased products are reported under category 3.11 in accordance with the GHG Protocol and the operational control approach.

In relation to category ‘3.12 End-of-life treatment of sold products’, lifecycle assessments are available for several representative product categories in the Industrial Trucks & Services segment that include information on end-of-life treatment. They are used to determine average GHG emissions per product category. The number of trucks recorded in 2024 is based on sales figures from internal sources and order intake data from World Industrial Truck Statistics (WITS). In the Supply Chain Solutions segment, end-of-life emissions are estimated using extrapolated data from the Industrial Trucks & Services segment and based on revenue figures because detailed analysis is not currently possible. As the range of industrial trucks used in projects in the Supply Chain Solutions segment is very broad and includes third-party equipment, insufficient data was available at the end of the reporting year for a specific analysis of emissions from the handling of sold Supply Chain Solutions products at the end of their lifecycle. The KION Group is in the process of preparing lifecycle assessments for the Supply Chain Solutions segment in order to establish a more reliable basis for calculation.

The KION Group holds investments in associates and other entities whose emissions are reported under category ‘3.15 Investments’. These emissions are calculated on the basis of the investees’ prior-year revenue and the KION Group’s share in the investees. The investees’ revenue is multiplied by a sector and country-specific emission factor and the KION Group’s share in the investees. The pro rata Scope 1 and Scope 2 emissions of these investees are included under category 3.15 for 2024 in accordance with the minimum requirements of the GHG Protocol. Scope 3 emissions of investees that are part of the KION Group’s value chain are included in the reporting. Emission factors from the Exiobase database are used.

Sources of estimation and outcome uncertainty

The calculations under categories ‘3.1 Purchased goods and services’, ‘3.2 Capital goods’, and ‘3.4 Upstream transportation and distribution’ are based on secondary data and are therefore subject to inherent uncertainty. Supplier-specific figures are not currently available, which is why average emission factors for the industry were used. The data is based on procurement data rather than on weight information or specific aspects of transportation. The procurement data available as at the end of the third quarter of the year is extrapolated. Due to the spend-based approach, the accuracy of the GHG emissions calculations compared with mass-based and activity-based approaches is limited. As not all subsidiaries are fully covered by the underlying spend data, an extrapolation is made on the basis of total energy consumption. A different extrapolation factor is used for production sites than for sales and administrative sites. In general, uncertainty arises from the use of industry-average emission factors. Although these have been checked and are scientifically sound, they are also based on a large number of assumptions. The allocation of emission factors and the categorization of purchased goods and services creates additional uncertainty. This arises in particular from purchased merchandise or semi-finished parts, as they cannot be clearly assigned to a category. As a result, a proportion of purchased goods and services remains unassigned to a category, and no suitable emission factor is available for this expenditure. Instead, it is calculated using an average emission factor that is specific to the KION Group.

The calculations under category ‘3.6 Business travel’ are predominantly based on activity data, such as passenger kilometers. Where no activity data is available, calculations are based on procurement data and extrapolations using headcount. Procurement data is subject to fluctuations and costs can vary depending on business conditions; estimates of travel emissions are therefore subject to uncertainty. In addition, secondary data from internationally recognized emission databases is used.

No primary measurement data is available for the category ‘3.7 Employee commuting’. Instead, statistical figures – which vary by region – are used in order to estimate emissions from KION employees’ commuting. These figures are based on averages from relevant surveys and can only approximate the actual emissions.

The following calculation methodologies apply in relation to category ‘3.11 Use of sold products’. The calculation of emissions in the Supply Chain Solutions segment is generally subject to a high degree of uncertainty due to project-specific differences in components and energy consumption. An average energy consumption figure for a number of reference projects was therefore determined through an analysis of projects. This figure has a high degree of uncertainty, as the elements can vary significantly between projects, energy consumption data from outsourced work can sometimes be incomplete, usage by customers can only be estimated on the basis of project specifications, assumptions about technical parameters might be adjusted, and no measurement data is available yet to validate planning data. Furthermore, the useful life of the assets can vary widely depending on the project. A medium average useful life was assumed for the calculation. There is also a lack of primary data on the electricity mix of customers, which is why national-average grid electricity factors are used (location-specific). Taking a conservative approach, the current location-specific electricity mix is applied for the entire use phase (lifetime emission factors), which adds uncertainty as potentially decreasing or increasing power grid factors are not taken into account. Furthermore, breaking the energy use in reference projects down to a revenue-based average value is a major simplification that entails a high degree of uncertainty. It should also be noted that all reference projects for the Supply Chain Solutions segment that were taken into account in the development of the reference model are located in the EMEA region. The extrapolation to other regions adds a further element of uncertainty to the estimates. The base data has not been updated as part of an annual review of the methodology since the average lifetime energy intensity was determined via the reference projects in 2022.

In the Industrial Trucks & Services segment, material uncertainty stems from the estimated operating hours of the equipment, which can vary considerably depending on how and where the equipment is used. Further uncertainty stems from estimates of lifetime electricity consumption. As there is no primary data on the electricity mix of customers, national-average grid electricity factors are used (location-specific). Taking a conservative approach, the current location-specific electricity mix is applied for the entire use phase (lifetime emission factors), which adds uncertainty as potentially decreasing or increasing power grid factors are not taken into account. As a data source, WITS gives rise to uncertainty as it reflects global order intake, and the number of trucks ordered is not based on the actual time of delivery to the customer. Overall, this time lag is negligible when it comes to calculating the GHG footprint.

In the calculation of category ‘3.12 End-of-life treatment of sold products’, the end-of-life emissions per truck category in the Industrial Trucks & Services segment are based on modeled average figures that are taken from lifecycle assessments for the relevant truck category. Truck-specific end-of-life GHG emissions therefore cannot be disclosed precisely. There is no primary data in the Supply Chain Solutions segment, which is why end-of-life emissions are extrapolated from revenue-based data in the Industrial Trucks & Services segment.

No primary data is available for GHG emissions from investments under category ‘3.15 Investments’. Instead, industry-specific Scope 1 and Scope 2 emission factors are used to multiply the relevant prior-year revenue. This approximation does not reflect the companies’ specific activities, but represents a statistical average value for the respective industry.

Disclosures on greenhouse gas removal, on greenhouse gas reduction projects financed through emission allowances, and on internal carbon pricing

In 2024, the KION Group did not carry out any GHG removal or storage activities either in its own operations or in its upstream or downstream value chain. The KION Group is in the planning phase for defining the scope of the methodologies and frameworks applied in terms of neutralizing any residual, unavoidable greenhouse gas emissions. The Group is guided by the standards of the SBTi on carbon removals as part of a net-zero target framework.

In the course of validating its climate targets, the KION Group resolved to not communicate claims of GHG neutrality.

The KION Group did not purchase any carbon credits in 2024, and no internal carbon pricing scheme was in place.

Entity-specific metrics for energy-efficient products

With respect to the material impacts and opportunities related to energy-efficient products, the KION Group discloses the entity-specific metric ‘proportion of electric vehicles sold’ for the Industrial Trucks & Services segment. The metric is linked to the respective strategic target and reflects both the potential positive impacts on downstream GHG emission reductions and the opportunities associated with a highly electrified product portfolio. In the reporting year, the proportion of electric vehicles sold in the Industrial Trucks & Services segment amounted to 91.7 percent (see ‘Strategy targets and target achievement in 2024’).

The calculation is based on the number of units in the order intake documented on a monthly basis for new business and is considered representative of the number of trucks sold. This involves determining the number of trucks ordered with an electric drive as a proportion of the total order volume in the Industrial Trucks & Services over the year as a whole. Order intake data is reported by the regional subsidiaries and brands across the Group, and software is used to collate it in the course of market research analyses. The industrial trucks ordered are divided into product categories according to the World Industrial Truck Statistics (WITS) of the Fédération Européenne de la Manutention (FEM), and the volume of electric trucks ordered is determined on the basis of these categories. The metric was not validated by an external body.