Ryder Systems Inc: Disclose Climate Transition Plan

WHEREAS: The Intergovernmental Panel on Climate Change reports that immediate emission reductions are required to avoid the most catastrophic impacts of global warming. Investor demand for science-aligned emission reduction goals and strategies underscore that companies and investors are increasingly exposed to physical, competitive, and systemic climate risks. Ryder Systems Inc, a leading logistics provider with services across North America, must decarbonize its transportation fleet to avoid these risks.

Transportation, which makes up 28% of U.S. energy consumption, faces increasing climate regulation. Seventeen states in key operating corridors set targets for 100% zero-emission truck sales by 2050.[1] California’s Advanced Clean Fleets rule requires commercial fleets to phase out non-zero emission vehicles starting in 2027.[2] As Ryder notes, such actions could reduce the resale value and demand for Ryder’s vehicles and maintenance services, to the extent it does not begin decarbonizing its fleet.[3]

While Ryder’s 2024 targets addressed operational and material value chain emissions, they fell short of Paris-aligned ambitions. Ryder states it is only considering operational targets going forward, lowering its ambition to address only 5% of its total emissions. It also fails to disclose a forward-looking decarbonization plan.[4]

Ryder operates 75,000 Class 1-7 trucks and 69,000 Class 8 tractors.[5] Battery electric vehicles across these classes are expected to exceed cost parity with diesel by 2030 driven by greater energy efficiency and lower operating costs.[6] Major manufacturers like Daimler, Volvo, and Navistar have pledged to sell only zero-emission trucks by 2040. Clean vehicle tax credits are also accelerating decarbonization of heavy-duty vehicles.[7] Ryder’s decarbonization strategy remains unclear, potentially impacting its profitability and competitiveness.

Peer DHL Group has set net zero targets across its value chain through the Science Based Targets initiative and provides advanced services to support customer decarbonization, a competitive advantage as more companies set value chain emissions targets.[8]

By setting interim emission reduction targets covering largest emission categories and disclosing a climate transition plan, Ryder can address regulatory, customer, and competitive pressures and position itself to benefit from the evolving low-carbon economy.

BE IT RESOLVED: Shareholders request the Board disclose how Ryder intends to reduce its operational and value chain greenhouse gas emissions in alignment with interim and long-term Paris-aligned climate targets.

SUPPORTING STATEMENT: Proponents suggest, at management discretion, the Company disclose:

The financial impact of lost business from failing to adapt to consumer and regulatory demands;
A timeline for setting Paris-aligned emission reduction targets; and
An enterprise-wide transition plan to meet evolving consumer demand and climate-related regulations, including anticipated costs and emissions reductions.

[1] https://www.epa.gov/greenvehicles/fast-facts-transportation-greenhouse-gas-emissions#:~:text=According%20to%20the%20Inventory%20of%20U.S.%20Greenhouse%20Gas,%2828%25%29%20of%20total%20U.S.%20GHG%20emissions%20in%202022; https://www-f.nescaum.org/documents/multi-state-medium-and-heavy-duty-zero-emission-vehicle-action-plan/

[2] https://www.movingforwardnetwork.com/wp-content/uploads/2024/03/MFN_Key-Facts_Understanding-the-Advanced-Clean-Fleet-Rule_2024.pdf#:~:text=California%20Adopted%20The%20Advanced%20Clean%20Fleets%20Rule%20In,2023%2C%20no%20other%20states%20have%20adopted%20the%20rule

[3] https://www.sec.gov/ix?doc=/Archives/edgar/data/85961/000008596124000030/r-20231231.htm, p.19

[4] https://www.ryder.com/globalassets/media/documents/non-solution/about-us/corporate-sustainability-report-2023.pdf

[5] https://www.sec.gov/ix?doc=/Archives/edgar/data/85961/000008596124000030/r-20231231.htm, p.33

[6] https://www.forbes.com/sites/energyinnovation/2024/03/06/electric-trucks-will-be-cheaper-than-diesel--decades-faster-than-expected/

[7] https://theicct.org/wp-content/uploads/2023/04/tco-alt-powertrain-long-haul-trucks-us-apr23.pdf, p.1, 31

[8] https://group.dhl.com/en/sustainability/environment.html; https://www.cdp.net/en/corporate-environmental-action-tracker?report=target_setting

Resolution Details

Company: Ryder Systems Inc.

Lead Filers:
As You Sow

Year: 2025