Hybrid fleets and the move to a circular economy

6 mins read

Hybrid fleets and the move to a circular economy
Hybrid fleets and the move to a circular economy

Even through the Covid era’s extra challenges, smart businesses are still focused on fleet sustainability. Find out how L’Oréal is setting the pace for change.

We spoke to L’Oréal’s Australian and New Zealand Executive General Manager David Higgins about the benefits of a circular economy, respecting the ‘nine planetary boundaries’, and how their Hybrid fleet helped with some unexpected wins through COVID-19.

How did you become General Manager of the Professional Products Division at L’Oréal?

I grew up in a family business. After leaving that, I worked at multinationals and across a variety of different sectors, including industrial and healthcare. I didn’t specifically go looking for L’Oréal as my next career move but it found me and I’m loving it. It’s an area that I’ve not worked in before and it’s growing – there’s a lot of innovation and opportunity. With the market presence we have here, we can make a difference in so many ways. Part of that is down to our environmental position but also the level of innovation at L’Oréal.

Can you tell us about the ‘L’Oréal For the Future’ campaign, and how the move to Hybrids fits in L’Oréal’s overall goal to ‘respect planetary boundaries’?

We don’t think about it as just a campaign. For us, it’s our way of doing business. What we want for the future is a more globally aligned and formalised version of a project that came out of the Stockholm Resilience Centre, where they determined that there were nine planetary boundaries in place. As a global leader, L’Oréal has a responsibility to protect those boundaries. Our association with Toyota and implementation of Hybrid vehicles comes under the ‘climate change’ boundary.


How do the Hybrids compare to your old vehicles? In terms of fuel costs, drivability, insurance costs and maintenance?

When we looked at this as an initiative, we didn’t focus on cost. The initial purchase was slightly more expensive but the real benefit for us is the reduction of CO2 emissions, which – over the ten-year lease we’ve now got through until 2024 – will be about a 300/320 tonne CO2 reduction. We do also have some fuel cost savings which helps offset the initial lease.

What has the customer response been to the Hybrid vehicles?

In New Zealand, our vehicles are branded, so they’re commonly recognised as Hybrid L’Oréal vehicles. In Australia, however, our vehicles aren’t branded. That’s the next project that I’m working on in conjunction with Toyota. The customer response has been interesting. With most of our account managers and educators, they pull up right outside a customer’s premises, from pharmacies and healthcare facilities to supermarkets and salons. The Hybrid badge is clearly visible and it stimulates a bit of conversation.

“For the smaller companies out there, even getting one Hybrid fleet vehicle is doing something for your business.”

– David Higgins, L’Oreal’s Executive General Manager

Is there any other reason you chose Toyota over other brands?

There’s a third party that sits between us and Toyota, which is our fleet management organisation. One of Toyota’s key points of differentiation is their willingness to engage directly. As soon as the new Kluger Hybrid came out they were on the phone to us directly. We had a look and consequently we’re going through a process now to implement them into the business as well. We also know that there is an exceptional service network. We know there’s an ability to have our fleet protected and looked after by that infrastructure, here and in New Zealand. For us, it’s a tried and tested, reliable brand and it’s fit for purpose for our account management and field teams.

L’Oréal is setting ambitious targets to reduce environmental impacts, not just your own company footprint but those of your suppliers and consumers. What would you say are the biggest challenges in this more holistic, global approach?

We don’t see a lot of challenges here because we’re a sizable global entity that can leverage opportunities over challenges. There’s a massive point of influence we can exert over the local and global market around driving sustainable, environmental initiatives.

We’re seeing that here with our local warehousing and distribution, our fleet choice, our packaging, our recycling initiatives and even with some programs we are taking to our customers. We service about fifty percent of Australian salons with a program to help them reduce waste. Salons give discarded hair to an organisation that converts it into an oil boom, which captures pollution or materials in an oil spill situation.

From us, as the manufacturer, we’re trying to create a circular economy. We’re supporting our business partners to work better, more effectively, more efficiently, and in a way that’s more conscious of their environmental impact. We want to provide everything they need to do the right thing as a partner to us.

Better energy density and range

Can you tell us a bit more about how you’re promoting a circular economy?

It starts with those organisations that we partner with to provide either the raw materials for us to manufacture our products, those organisations that transport finished goods and then those consumers or customers that purchase products. It starts by making sure we’re dealing with companies that have an environmental position and policy that aligns with ours. Then it’s up to us, as a manufacturer of those raw materials, to make sure we approach everything in an environmentally sustainable way. We’re utilising water loops in our manufacturing facilities. Solar panels are used extensively globally on all our manufacturing and warehousing facilities. As we have finished goods that go out to our consumers and customers, we provide a program around recycling products. We also work with our salon/hairdressing partners to be able to be environmentally sustainable themselves.

That’s the true circular economy, where you’re doing it across every touchpoint – product, raw materials sourcing, manufacturing, warehousing and distribution. Hybrid fleets are one of the elements because the team that’s in the field, on the road, seeing customers, taking orders, taking samples, doing business consultations – helping keep the business running.

What were some of the most inspiring ideas or actions you heard about L’Oréal’s Respecting our Planetary Boundaries virtual panel?

One part of the discussion was around consumer knowledge – the consumer has never been more educated than they are now, and I love that. It holds us accountable as an organisation. The consumer will do research about the product packaging and the product label, and supply chain custody. They’ll have a look all the way through to see if you are doing all the things that you said you would do.

At the event, Julie Bishop also touched on a point about the public versus the private sector. In Australia, the political, public sector isn’t as willing and responsive to step forward and commit to change in the nine elements, compared to L’Oréal globally. So the private sector has a responsibility to do something about it.


Are there any challenges L’Oréal has faced in recent times where vehicles have been at the centre of the solution?

During the pandemic, there was a challenge on the back of supply chain issues where account managers and educators had to change into pseudo-couriers at times to get product around, which was why the Toyota fleet, and the vehicle choice, was perfect. The RAV4 has the capacity to carry a lot of products, so we were able to ask our account managers to drop products to customers on their routes, as COVID-19 made it hard to move products around.

Better energy density and range

What do you think is the biggest opportunity for L’Oréal in the next few years?

Our consumers drive the innovation in products. They drive our innovations in marketing and they drive our distribution channel strategies. Our willingness to get closer to our consumers and understand them better will make us a far more informed organisation.

What’s your leadership philosophy?

I do have an approach to how I manage myself and how I engage with my team. There are three simple principles that I work to: being calm, humble and brave, also trusting my team, and getting it right versus being right. They’re the things that have put me in good stead.

Is there anything else you’d like to add?

For the smaller companies out there, even getting one Hybrid fleet vehicle is doing something for your business. You don’t have to be L’Oréal to make a change, you can do it stage by stage: one vehicle change can make all the difference for those smaller organisations.


This information provided is of a general nature and for information only. Nothing in this article constitutes or should be considered to constitute legal, taxation or financial advice. Before making a decision about any of the products and services featured on this article, you should consult with your own independent legal, taxation and financial advisors, who can advise you about your personal circumstances.

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