04 Sustainability Statement Climate change (E1) Category description and boundary Analysis of main changes in 2024 versus 2023 Category 12 Category 12 includes emissions from the collection of end-of-life tires, using the cut-off method. The same method is used to calculate emissions from the small number of tires landfilled without any recycling or energy recovery. The change primarily reflected the decline in volumes sold over the year. Category 14 Category 14 includes emissions from franchised tire and vehicle service centers, estimated from measurements at a sample of Euromaster outlets. The change was led by an increase in the number of franchised service centers. Category 15 Category 15 includes emissions from investments in equityaccounted companies. For these investments, the Group measures emissions from their energy use and, in the case of natural rubber companies, from rubber tree farms. Land use change is not calculated, in accordance with the SBTi. The change mainly stemmed from the decline in distribution company sales. Categories 10 and 13 are not material to Michelin. According to the GHG Protocol Corporate Standard, the benchmark for corporate carbon accounting, measuring CO2 emissions from tires in-use is optional because they only have an indirect impact on vehicle fuel efficiency. On the one hand, there is the "required" Scope 3 composed of all Scope 3 categories except for the Scope 3 use phase, and on the other hand, the Scope 3 use phase that is "optional" under the GHG Protocol. Scope 3 Use of sold products Category 11 Scope 3 emissions are particularly difficult to estimate due to the wide variety of vehicle (and therefore tire) usage scenarios and the relative lack of actual usage data. Nevertheless, Michelin made progress in 2024, both in estimating emissions from each type of tire in use and in increasing the number of products in the scope of reporting. Scope of reporting Data are reported for emissions from the use of (i) Passenger car, Light truck and Truck tires; (ii) specialty tires (mining, aircraft, beyond-road); and (iii) tires from other manufacturers sold through Euromaster. Calculation methodology Use-phase emissions of each tire range are calculated based on: n usage data from life cycle assessments; n the most credible average mileage assumptions based on Michelin usage data (taking into account premature replacement practices and the possibility of reselling the used tires); n powertrain assumptions (internal combustion versus electric). In accordance with the GHG Protocol, and contrary to LCA practices, use-phase emissions are calculated on a tank-to-wheel (TTW) basis, rather than well-to-wheel (WTW). This means that CO2 emissions from the upstream vehicle energy phases are not included. NB: There is no standard, industry-wide methodology for calculating category 11 Scope 3 CO2 emissions from the use of sold products. Only the Japan Automobile Tyre Manufacturers Association Inc. (JATMA) has issued a methodology, but few manufacturers use it. However, while it is interesting as a calculation method, JATMA’s proposed parameters do not seem to reflect actual conditions of use. For example, the mileage lifespan parameter is much lower than the actual useful lives measured by Michelin. Consequently, for the sake of plausibility, in 2024 Michelin used parameters based on its own usage statistics. Had the JATMA methodology been used instead, Scope 3 CO2 emissions from the use of sold products would have been approximately 30% to 40% lower than those disclosed below. Outcome The reduction from 130 MtCO2(1) in 2023 to 115 MtCO2 in 2024 did not result from any improvement in emissions, which are difficult to assess. Instead, it reflected: n a broader scope of reporting, which now includes specialty tires; n the use of a new, more accurate calculation method. Application of the new method will enable progress to be tracked in future disclosures. (1) As disclosed in the 2023 Universal Registration Document. 215 2024 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN
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