Exchange 2.0: implementing circular economy in distribution
Audi wants to reduce its environmental impact and conserve resources along the entire value chain. With this in mind, the four rings has established the principles of a closed-loop circular economy during the development, manufacture and marketing of its products. The company has reached an important milestone in its efforts with the Exchange 2.0 project. In cooperation with the Volkswagen plant in Kassel, Audi has developed a sustainable remanufacturing method for mechatronic parts and transmissions for Audi S tronic models.
Circular economy at Audi
Gears, screws or gaskets are just some of the small parts that go into a transmission. If one of the components quit working, it used to mean a lot of work for Audi employees: “We had to disassemble everything to find the fault – even the wheel set,” explains Dominic Rattmann from Audi Product Management Genuine Parts. That cost not only time but a lot of money as well. And aside from that, at most only half of the components were reused. The rest were replaced as a precaution.
That has changed now. Thanks to the new remanufacturing method, up to 80 percent of the individual parts in the value chain can be conserved. Projected over the year, this means employees can currently reprocess up to 4,500 transmissions and 20,000 mechatronic parts. The market launch for the remanufacturing will take place during the course of 2019.
New process standard: innovative and sustainable
Unlike in the past, parts no longer have to be replaced preventively and disposed of.
The Exchange 2.0 project was initiated by Dominic Rattmann and is the first joint remanufacturing concept from both Audi Ingolstadt and the Volkswagen Group Kassel. While the complex S tronic transmissions are being processed in Kassel, the Ingolstadt assemblies remanufacturing unit handles the mechatronic parts. That is yet another first: mechatronic parts have never before been remanufactured in the VW Group. A total of around 40 employees from Research and Development, Genuine Parts, Finance, Production Planning and Quality Assurance pushed the development of the program forward across all brands and developed new tools, systems and lines for the implementation.
The new process standard involves a number of different steps. First, dealers must complete a checklist if customers lodge complaints about vehicles. The list offers the first clues about possible causes of defects. Employees then analyze the data from the fault memory. The fault codes provide information on potential prior damage to the wheel set or other components: “Even at this stage we can already search for components that should be remanufactured,” says Johann Wendl from Quality Assurance Powertrain. “Unlike in the past, parts no longer have to be replaced preventively and disposed of.” As a result, the new intelligent diagnostics save numerous process steps that had previously been necessary. In addition, the new cleaning method removes oil from the components and provides more information.
Remanufacturing of the components following diagnosis
We have shown how replacement parts can be remanufactured at a premium level.
Only genuine parts that have been approved by Technical Development can be used to remanufacture the transmissions: “This sets us apart from our competitors, who sometimes do not have the option of procuring genuine parts. We have shown how replacement parts can be remanufactured at a premium level,” says Michael-Andreas Spreng, Head of Engine Remanufacturing. The transmission is then subjected to a 100 percent functional inspection on the test bench. And Wendl confirms: “The tests so far have demonstrated that the remanufactured transmissions meet the quality criteria of new parts. This is also currently being verified by vehicle tests and safety runs.”
With use of the methods starting in the second half of 2019, Audi will achieve the conceptual process capability for the new remanufacturing method for other components as well: “As a consequence, we’re focusing on innovation leadership of our remanufactured components.” And Dominic Rattmann adds: “With the Exchange 2.0 project we are embodying the circular economy in Audi distribution and are also managing to combine the strategic key areas of sustainability and digitalization.”
Circular economy: focusing on reuse
The added environmental and economic value of the project is indeed impressive. The use phases of individual components are considerably lengthened through repair or reuse. The four rings could reduce its overall material consumption for transmissions and mechatronic parts by up to 80 percent. The goal is for the new process to pay for itself after just one year. Industrial remanufacturing of used parts in genuine-part quality is the second approach within the circular economy. By adding this sustainable remanufacturing process, Audi is expanding its various programs in order to advance the circular economy along the entire value chain. Audi has already introduced successful aluminum recycling projects.
These projects and the current Exchange 2.0 project are thus contributing directly to the sustainability strategy at Audi (circular economy/resources action area). Audi has also expressly committed to the UN’s Sustainable Development Goals (SDGs).