Audi closes circles
Circular economy at Audi
“At Audi we want to find sustainable business models that can be implemented to the ultimate benefit of all stakeholders.”
When Dennis Christian Meinen talks about his work, those listening quickly get the feeling that he is trying to “square the circle.” “One of the key challenges of this century involves decoupling economic growth from excessive consumption of resources – while increasing average quality of life and reducing emissions at the same time.” And before anyone can ask, the circular economy (CE) expert adds with a smile: “Yes, the question of how to achieve a circular economy is occupying economic experts all over the world. And it has cost me a few sleepless nights too. But it’s worth it – because at Audi we want to find sustainable business models that can be implemented to the ultimate benefit of all stakeholders.”
Help in the form of good, new ideas is vital, since the facts have long since shown that something is out of balance. The consumption and behavior patterns that have prevailed since 1971 have led to the world’s population consuming renewable resources faster than they can be regenerated and reproduced by the earth and its ecosystems each year.
Closing the cycles
The problem is that an economic system based on growth and continuous and even rising extraction of primary raw materials cannot be sustained on a planet with finite resources. From Audi’s perspective, circles need to be closed if a solution is to be found that does not substantially reduce our standard of living and enables continued economic growth and improved social conditions in developing countries. In this respect, the paradigm shift away from the linear economic system offers potential from both an economic and an ecological and social perspective.
“Audi’s sustainability strategy evaluates and follows diverse approaches for implementing a circular system in the automotive value chain: from development and material procurement to production and marketing of products, use and reuse,” says Meinen.
Can the effort pay off? This too is a frequently debated topic among economic experts. Numerous discussions highlight the enormous economic potential of circularity. According to the Ellen MacArthur Foundation, net savings of more than 600 billion US dollars are predicted in the European Economic Area (EEA) through measures such as ecological product design, waste avoidance or reuse– while reducing greenhouse gas emissions at the same time. This will only be possible, however, if all the measures are also actually implemented.
Focus on recycling rates
There are clear laws on the socially important topic of recycling. The German End-of-Life Vehicle Ordinance, for example, requires since 2015 that, of the average net weight of an end-of-life vehicle (ELV), at least 95 percent be subject to reuse or recovery relative to the total number of ELVs in a given year.
In essence then, no part of an ELV is useless. As environmental awareness increases among many consumers – partly due to the rise in public debate on the subject of sustainability – the issues of recycling and reuse have also increased in importance. Audi already has a number of successful projects under its belt in these areas, for example the Aluminum Closed Loop in production (page 65) or the industrial reconditioning of used components to genuine-part quality.
Moreover, Audi is an active member of the Global Battery Alliance, which aims to establish a sustainable value chain for batteries, from resource mining through to sustainable recycling.
Holistic business models
“What’s also great about the CE in my view is that it drives innovation and has the potential to encourage further initiatives.”
In the year under review, Audi analyzed all conceivable CE business models throughout the entire life cycle of the vehicle from social, ecological, and economic perspectives in order to gain an understanding of the full potential of CE. Based on the findings, scenarios are currently being discussed, for example, for how the classic business model within the meaning of the CE can soon be extended – to the benefit of all stakeholders.
According to Meinen, “Direct, end-to-end product responsibility throughout the entire product life cycle is a basic condition for exploiting all the potential in the spirit of sustainability.” In addition, ensuring the environmental compatibility of the products can also enhance the positive image of the company.
New power from old cells
Battery recycling is a fundamental part of sustainable electric mobility for Audi. In the year under review, Audi successfully pursued a strategic research partnership for battery recycling. The result: Over 90 percent of the cobalt and nickel from the high-voltage batteries of the Audi e-tron can be recovered.
The company is therefore now starting another phase and is testing a closed loop for cobalt and nickel: Together with a partner, Audi is working toward using the raw materials recovered from battery recycling in new battery cells. Audi and Volkswagen are developing a variety of other concepts for handling used high-voltage batteries. When a battery has lost some of its charging capacity after years of use in a vehicle, it can continue to be used outside of a vehicle, for example.
Among the many potential applications examined by Audi in this regard, in the year under review the company investigated using such batteries in forklift trucks and tractor units at the main plant in Ingolstadt as well as in stationary energy storage devices at the EUREF campus in Berlin.