Lego plans to make half the plastic in its bricks from renewable or recycled material rather than fossil fuels by 2026, in its latest effort to ensure its toys are more environmentally friendly.
The Danish company last year ditched efforts to make bricks entirely from recycled bottles because of cost and production issues. At the moment, 22% of the material in its colourful bricks is not made from fossil fuels.
In the long term, Lego plans to switch entirely to renewable and recycled plastic by 2032, in a green push that has resulted in the company testing more than 600 alternative materials.
The toymaker hopes gradually to bring down the amount of oil-based plastic it uses by paying up to 70% more for certified renewable resin, the raw plastic used to manufacture the bricks, in an attempt to encourage manufacturers to increase production.
Lego’s plastic producers are replacing virgin fossil fuels with alternatives such as cooking oil or food industry waste fat as well as recycled materials but costs can be two or three times higher because the market is still developing.
Niels Christiansen, the chief executive of Lego, said the shift towards more sustainable materials meant a significant increase in the cost of producing its bricks.
Last year, the group pledged to triple spending on sustainability to 3bn Danish kroner (£340m) a year by 2025, while promising not to pass on higher costs to consumers.
“So far we have decided that we will bear the burden of it, and [the extra cost] comes out of our bottom line. We are not sure consumers are very willing to pay,” Christiansen told the Guardian.
He said Lego was making the investment to “try to push the industry to develop” and “shift the supply chain” by increasing demand and he said it was hoped this would eventually lead to the development of new or cheaper materials that would help Lego meet its 2032 target.
Lego has also expanded its brick takeback programme, Replay – where consumers can donate old bricks to the company through free shipping – into the UK and continued to test similar models in the US and Europe.
On Wednesday, Lego reported a 13% rise in sales to 31bn kroner in the first half of this year as it claimed it had “significantly outpaced the toy industry, gaining market share”.
Operating profit rose 26% to a record 8.1bn kroner as the group launched about 300 new sets within top performers, including its icons sets. The range includes a £259.99 Lamborghini kit and the £554.99 Eiffel Tower, as well as Technics, Star Wars and Harry Potter toys. Christiansen said its botanical collection – of plant-themed kits – had helped increase appeal among adult women who were now bigger advocates for the brand.
“Our portfolio continues to be relevant for all ages and interests, and this is driving significant demand across markets. We used our solid financial foundation to further increase spending on strategic initiatives which will support growth now and in the future to enable us to bring learning through play to even more children,” Christiansen said.
He said the toy market had shrunk by about 7% last year, the worst performance in 15 years. However, he said that sales across the market had been flat in the first half of this year and could return to growth in the second half.
Christiansen said the brand had “good momentum” as it expected to continue to outperform the wider market.
