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Sustainability in the Auto Recycling Industry – A Path Towards a Greener Future

Tom Mills, Managing Director and Founder of Two Oceans Strategy (TOS), a data-led sustainability consultancy, explores the vital role of sustainability in auto recycling.


Sustainability in the Auto Recycling Industry - A Path Towards a Greener Future soc
Tom Mills

Sustainability has become a buzzword in today’s world, and for good reason. As we face the challenges of climate change and environmental degradation, adopting sustainable practices in every industry is crucial. The vehicle recycling industry is no exception. In this article, we will explore what sustainability means in the context of the auto recycling industry and how it can be achieved through responsible supply chains, collaboration and partnership, circularity of components, and comprehensive measurement of key material issues.

Responsible Supply Chains

To truly achieve sustainability in the auto recycling industry, it is essential to follow the components of vehicles back to their source and understand the social and environmental risks within the supply chain. This means ensuring that the materials used in the production of vehicles are responsibly sourced, minimising the negative impacts on local communities and ecosystems. The industry can reduce its carbon footprint by adopting responsible supply chains and contributing to a more sustainable future.

Improved technology will revolutionise how the auto recycling industry keeps track of sustainability metrics. With the advent of advanced tracking systems, such as RFID tags and barcode scanning, it will be easier to trace the origin and composition of vehicle components, ensuring responsible sourcing and recycling practices. Additionally, digital platforms and databases can be utilised to store and analyse data on recycling rates, material composition, and environmental impacts. This will give the industry a comprehensive and real-time understanding of its sustainability performance, allowing for better decision-making and targeted improvements. Emerging technologies like artificial intelligence and machine learning can also be employed to analyse large datasets and identify patterns and trends, providing valuable insights for optimising recycling processes and reducing waste.

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Measurement of Key Material Issues

To effectively track progress towards sustainability, measuring the embodied carbon of vehicles and other key material issues is crucial. These include water usage, biodiversity loss, non-carbon air emissions, waste generation, and social impacts. By comprehensively measuring these factors, the industry can identify areas for improvement and make informed decisions to minimise its environmental and social footprint. A study conducted by the World Business Council for Sustainable Development found that the auto recycling industry has the potential to save up to 1.5 billion cubic meters of water annually through improved water management practices.

Collaboration and Partnership

One player alone cannot address supply chain risks and achieve sustainability in the auto recycling industry. It requires a sector-wide approach, with collaboration and partnership among all stakeholders. By working together, industry players can share knowledge, resources, and best practices, ultimately gaining the power to evoke change on a larger scale. The International Automotive Recycling Congress reported that collaboration among industry players has led to a significant increase in the recycling rate of end-of-life vehicles, reaching an impressive 95% in some countries.

Circularity of All Components

Achieving sustainability in the auto recycling industry goes beyond recycling vehicles as a whole. It also involves ensuring the circularity of all components. This means designing vehicles with recyclability in mind, making it easier to disassemble and reuse their parts. The industry can minimise waste, conserve resources, and reduce its environmental impact by embracing circularity. The European Commission estimates that by increasing the recyclability of vehicles and their components, the auto recycling industry could save up to 80 million tons of CO2 emissions annually.

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Transparent Reporting and Contextualisation

In the pursuit of sustainability, it is essential for the auto recycling industry to be transparent in reporting its progress and achievements. The industry can foster trust and accountability by sharing data and information with stakeholders. Additionally, contextualising the data with others in the sector allows for benchmarking and identifying areas where further improvements can be made. The Automotive Recyclers Association encourages its members to report their recycling rates and environmental performance. This transparency helps track progress and promotes healthy competition among industry players.

The right technology will play a crucial role in aiding the auto-recycling industry in reporting. With the use of digital platforms and databases, industry players can easily collect, store, and analyse data on recycling rates, material composition, and environmental impacts. This allows for more accurate and comprehensive reporting, providing stakeholders with transparent and reliable information. According to a study conducted by the World Business Council for Sustainable Development, digital platforms and data analytics can help improve reporting accuracy by up to 30%. Additionally, technology can automate the reporting process, reducing the time and resources required for manual data collection and analysis. This not only improves efficiency but also ensures that reporting is done in a timely manner. Overall, technology enables the auto-recycling industry to have a more transparent and accountable reporting system, facilitating better decision-making and driving continuous improvement in sustainability performance.

High-Quality Offsets for Hard-to-Abate Emissions

While the auto recycling industry strives to minimise its carbon footprint, there may still be hard-to-abate emissions that cannot be eliminated entirely. In such cases, buying high-quality offsets that have permanence, are verifiable, and are additional is crucial. This ensures that the industry invests in credible projects that effectively remove or reduce carbon dioxide from the atmosphere. According to a report by the Environmental Defense Fund, investing in technology-based Carbon Dioxide Removals can be more expensive but is necessary to achieve long-term climate goals.

The auto recycling industry has a significant role to play in achieving sustainability and mitigating the environmental impacts of the automotive sector. The industry can pave the way towards a greener future by embracing responsible supply chains, collaboration and partnership, circularity of components, comprehensive measurement of key material issues, transparent reporting, and high-quality offsets. Through these collective efforts, the auto recycling industry can contribute to a more sustainable and resilient planet for generations to come.

To discover more about Two  Oceans Strategy, please visit