Apple to drop plastic packaging by end of next year, no leather cases for iPhone15

By Rachel Koning Beals

iPhone15 launch features green efforts, including a faster shift from plastic and leather and a carbon-neutral Series 9 Watch. But at least one analyst thinks Apple needs to be a bigger sustainability disruptor to keep young customers happy.

Apple Inc. will phase out all plastic packaging by the end of 2024, slightly faster than it indicated earlier, and it's now selling a carbon-neutral watch, the company said Tuesday as part of its iPhone15 launch.

Apple (AAPL) announced a suite of iPhone 15 offerings, and the brand-new Apple Watch, the Series 9, made with 95% titanium and with 72 hours of battery life.

Read the MarketWatch Live Blog from the Apple event.

Lisa Jackson, Apple's vice president of environment, policy and social initiatives, said that the company's Watch Series 9 will be Apple's "first-ever carbon-neutral product." Jackson said this claim has been certified by an independent third party.

The company said it will achieve its carbon-neutral goal by shipping products by ocean and using carbon credits to offset the rest of the emissions. Broadly speaking, carbon pledges do come under fire in some camps as difficult to track and not going far enough to curb demand for products that produce carbon emissions in the first place. Man-made carbon and other emissions are behind the accelerating global warming that intensifying extreme heat and storms and acidifying oceans.

The tech giant has dribbled out sustainability initiatives on a regular basis since 2000 and has moved to reduce plastic wrapping and boxes in recent years. In 2021, Apple claimed that removing a layer of plastic over an iPhone box would mean saving "600 metrics tons of plastic." It said at the time that it expected to completely eliminate the use of plastic in all of its product packaging by 2025.

The rollouts Tuesday also confirm a shift away from leather and with it, reduced reliance on animal-sourced products whose care and processing carry their own sizeable environmental footprint.

In lieu of animal-derived leather, Apple will use what it is calling "fine woven," a vegan leather-like option made of 68% post-consumer recycled content. And that gives it a significantly lower carbon footprint than leather, Apple said.

Apple said a recent shift to favor recycled materials in product manufacturing extends to the new iPhone 15 lineup. The offerings, for instance, include 100% renewable cobalt in the battery. The change, the company claims, marks a first for rare-Earth material recycling.

Previously announced, the company had indicated it was shifting sourcing for the crucial metals used in construction of its phones and other products, like aluminum, cobalt and gold, to recycled sources.

And, Apple said Tuesday, it is furthering the commitment to renewable resources by offsetting the Watch Series 9 user's electricity through investment in renewable energy sources, which might include solar and wind.

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In 2020, the company pledged to be completely carbon neutral by 2030, and Apple said Tuesday it is on pace to meet that goal.

"We've innovated and retooled almost every part of our process to reduce our impact on the planet," CEO Tim Cook said. "By 2030, all Apple devices will have a net zero climate impact."

As most emissions promises go, net-zero is achieved by cutting the use of emitting fossil-fuels, such as coal, oil and natural gas, but also by investing in or using still-nascent technology for capturing emissions, or by planting carbon-absorbing trees to offset the greenhouse gases that a company does produce. Apple has said its own direct operations have been carbon neutral since 2020.

In 2022, Apple challenged its global supply chain partners to take further steps to address greenhouse gas emissions.

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Thomas Husson, a vice president and principal analyst at consultancy Forrester, said his takeaway from Tuesday's sustainability announcements was Apple's shift in language to suggest these moves offer a competitive advantage, "especially with Apple's first carbon-neutral products."

Husson said data shows about 17% of Apple's U.S. customers and 24% of its European customers say they're willing to pay up for greener Apple products.

But, Husson suggests, to add to a customer base of increasingly green-minded consumers, a once-reluctant Apple about repairs, may need to do more toward allowing users to fix, upgrade and recycle old phones and devices into new.

"While Apple is making progress towards its 2030 sustainability goals, the company is not yet fully embracing the circular economy," he said, in a note. "A bolder and more disruptive offering would consist into launching a 'device-as-a-service' subscription mixing hardware, content, services, repair and recycling options."

-Rachel Koning Beals

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09-12-23 1552ET

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