How will the circular economy impact the fleet industry?

hand held circular economy icon The concept of eternal circular economy Endless and unlimited for future business growth and design for reuse and environmental sustainability.
hand held circular economy icon The concept of eternal circular economy Endless and unlimited for future business growth and design for reuse and environmental sustainability.

You hear almost every day about the manufacturing of internal combustion engine (ICE) vehicles being halted by 2035. More electric vehicles are making their way onto the road, causing a revolution in the fleet industry. A circular economy approach is needed to fully integrate electric vehicles (EVs) to reduce the environmental impact- by reusing, repairing, remanufacturing, and recycling vehicle parts.

What is a circular economy?

Most people and industries are used to operating in a linear economy- taking raw materials to make a product, using it, and then throwing it out as waste. A circular economy is different, and it will change how we operate by eliminating waste and preserving raw materials.

“A CE [circular economy] is an economic system in which ‘the value of products and materials is maintained for as long as possible; waste and resource use are minimised, and resources are kept within the economy when a product has reached the end of its life, to be used again and again to create further value’” (Wurster,1). This process is just another way towards sustainability so we can maximise resource efficiency in vehicles. Extending the life cycle of EV batteries is key in creating a successful circular economy.

How the industry will change

EVs will deliver a sustainable transportation system and allow us to transition away from a linear economy. This can be done by repairing and reusing materials to extend an EV’s lifetime and lower the environmental impact of manufacturing new parts. Batteries pose the biggest challenge as they are hazardous and flammable.

EV batteries can last for approximately 10-20 years before they need to be replaced. Even once the battery has outlasted its usefulness, it still holds a lot of value, and could be used for a different purpose. Right now, batteries are not recyclable, so at the end of their life cycle it ends up in a landfill. This will not be the case for long, as the UK has committed to being net-zero emissions by the year 2050.

The circular economy goes beyond electric vehicle batteries. More than 80% of consumers have expressed an interest in a circular economy-based car interior trim, floor coverings, and seats, followed by another 63% who are for recycling car body materials:

  • Mirrors
  • Steering wheels
  • Rims
  • Glass
  • Electronic & electronics

Consumer interest is a must for further circular economy development (Wurster,16). The automotive industry is doing its part to incorporate consumer input into manufacturing, but fleets need to do their part as well.

How to prepare for the change

These future changes will impact the fleet industry, and impact how we maintain assets. Organisations need to start looking at everything they own, to ensure they are properly maintained. The solution is to not own everything and use things when you need them.

Everything needs to be maintained still but assets will/can tell you when it needs to be fixed. AssetWorks can manage that change and shift in culture as we have been helping fleets from acquisition to disposing of assets.

Fleet Management solutions with strong predictive mapping for repairs, refurbishment, and replacements, supported by a fully digitised operational experience will ensure the optimisation of the emerging circular economy.

How AssetWorks can prepare your fleet

Fleets have a lot of questions on how to work through these industry changes:

  • How do I manage decarbonisation?
  • How do I transition to EV or hydrogen?
  • What are the other alternative fuels I could use?
  • How do I manage a change in maintenance activity when transitioning to EV as there will be fewer parts?
  • Can I commercialise my fleet operation?
  • How do I digitise my operation?
  • How do I manage better mobility planning for my employees?

If you have any of these questions, AssetWorks can act as a consultant through these industry changes. AssetWorks is unique because we have been fully integrated, so we can offer a way to engage within the fleet industry.

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