Japan’s Ministry of Economy, Trade and Industry (METI) will step up efforts to recycle plastics from end-of-life vehicles (ELVs) by improving dismantling processes and reducing transport costs.
To support this, METI will establish regional working groups linking auto dismantlers with recycled plastic producers across the country. The initiative, titled the Regional Working Group for the Collection and Supply of Recycled Materials, will initially launch in three regions, including Hokkaido. Members will include local dismantlers, shredder operators, recycled plastics producers, government officials, and academic experts. Several meetings will be held in 2026, with the goal of forming a nationwide network by the end of that year.
The move comes as Japan aligns with global circular economy efforts. Europe is targeting 15% recycled plastic use in vehicles, and Japan set a similar goal in March: at least 15% by 2031—equating to an annual demand of roughly 25,000 tons.
Cost, however, remains a significant hurdle. Beginning April 2026, the government will introduce a Resource Collection Incentive Program, offering subsidies of several dozen yen per kilogram for plastics and glass currently discarded as part of automobile shredder residue (ASR). Yet, industry insiders remain skeptical. “Market prices are too low,” one dismantler noted. “Even with incentives, it doesn’t add up.”
Due to their low weight and high volume, plastics are expensive to transport—another challenge METI aims to tackle. The ministry plans to survey around 700 companies involved in dismantling, shredding, and recycled plastics production to map out the supply chain and identify ways to streamline operations nationwide.
Source Jara Daily Automotive Newsletter, July 2025
METI to boost used plastics recycling and cut transport costs by creating new regional bases
The Ministry of Economy, Trade and Industry (METI) plans to promote the recycling of used plastics derived from end-of-life-vehicles (ELVs) by leveraging advanced dismantling technology and reducing transport costs.
The ministry will establish regional working groups (WG) connecting automobile dismantlers and recycled plastics producers nationwide.
The Regional Working Group for the Collection and Supply of Recycled Materials” will be launched in three regions, including Hokkaido. Members will include local dismantlers, shredder operators, recycled plastics producers, administrative officers, and academic experts. Several meetings will be held in 2026 to establish a nationwide association by 2026.
Amid active involvement in the circular economy, Europe aims to use recycled plastics in vehicle production, with 15% will be vehicle-related plastics. Japan set a similar goal in March, that is, at least 15% recycled plastics for vehicles by 2031, requiring about 25,000 tons of supply annually.
However, cost remains the biggest challenge. Starting April 2026, the government will launch the “Resource Collection Incentive Program,” paying several dozen yen per one kilogram for ELV-derived plastics and glasses, which are currently discarded as automobile shredder residue (ASR). However, an automobile dismantler said, “Market prices of these are low. That does not add up, even with the incentive.”
Plastics are lightweight and bulky, making transport costly.
To address the supply chain of recycled materials, METI plans to survey approximately 700 companies of dismantlers, shredder operators, recycled plastics producers nationwide.
Source Jara Daily Automotive Newsletter, July 2025
