Stellantis Aims to Quadruple Remanufacturing Business by 2030 to Reduce Carbon Footprint
Stellantis, the parent company of 14 automotive brands including Citroën, Fiat, Peugeot, and Vauxhall, is looking to extend the life of its vehicles beyond the current 12-year average. The company aims to harvest reusable parts from scrapped cars and implement other initiatives to cut its overall CO2 footprint. The move could potentially impact Stellantis’ new-car sales in Europe, but the company is eyeing increases in sales in other parts of the world to mitigate that.
Stellantis’ head of circular economy, Alison Jones, said that the company is targeting 15 years as a new average car life, up from the current 12 years. Reusing parts and designing cars to last longer is part of the company’s pledge to reach net-zero emissions by 2038. Enabling existing cars to last longer has become another route to reducing CO2 as the spotlight falls on the potential extra carbon footprint of building battery-electric cars.
The average car life across all Stellantis brands is currently around 12 years, which is the same as the European average according to data from European automotive lobby group the ACEA. Stellantis has an internal target to increase that figure, which it hasn’t disclosed, but Jones told journalists that boosting the average life to 15 years “I don’t think is too crazy”.
Stellantis announced last year that it plans to “remanufacture” used parts along with complete vehicles as part of its plan to extend vehicle life. The scheme will use the Mirafiori plant in Turin, Italy, which will become a second-hand vehicle reconditioning, dismantling and parts remanufacturing hub as part of an investment totalling more than €10 million (£8.7m). Stellantis is confident that it can quadruple this side of its business by 2030, from an annual revenue of €528 million (£463m) in 2021 to €2 billion (£1.7bn) by 2030.
Renault’s Refactory in Flins, France, processes around 55 vehicles an hour, while Toyota has said it will start refurbishing used cars up to three times at its Burnaston plant in the UK. Car makers are increasingly looking at ways to keep cars in their ownership through extended leasing. Citroën, for example, is considering offering 15-year car leases. It said the extended leases would have the same maintenance contract as they had in the first year, implying confidence of reliability. All cars under these contracts will be maintained solely using recycled parts, reducing their costs.
Afeela, the new premium EV brand from Honda and Sony, is aiming for 10-year leases in which owners are promised frequent over-the-air upgrades, which theoretically would keep the car fresh and allow it to continue charging the same monthly fee. Afeela is investing to install high-powered computer chips to ensure software updates can still be handled by the hardware as the car ages, which will be an issue for those companies that don’t pay to futureproof their hardware.
Car companies’ plans to increase the longevity of vehicles will give the European Union ammunition to push through its disliked Euro 7 emissions proposals, which include a rule to double the length of emissions compliance for ICE cars and vans from 100,000km (62,137 miles) and five years of age to 200,000km (124,274 miles) and 10 years. Car makers will argue that worsening emissions are due to poor maintenance, which they can control in a lease situation in which free maintenance is included.
Stellantis is working on a programme to improve vehicle quality not just in terms of reliability but also in the design phase “in order to reduce signs of aging and wear and tear, with the intention for the vehicle to look as close to new after years of customer usage as possible”, the company wrote in its latest corporate and social responsibility report. It said it was carrying out “specific vehicle aging tests” to improve resale value and increase usable lifetime.
Remanufacturing Could Reduce Carbon Footprint
Enabling existing cars to last longer has become another route to reducing CO2 as the spotlight falls on the potential extra carbon footprint of building battery-electric cars. The positive benefits of keeping cars longer was one of the subjects of a widely read Guardian story from last weekend by actor, comedian, and car enthusiast Rowan Atkinson. “We need to acknowledge what a great asset we have in the cars that currently exist. These cars have paid their environmental dues,” he wrote, while also admitting that older cars also emit more CO2 and tailpipe emissions.
The UK car parc is one of the youngest in Europe, with an average of 8.6 years, according to 2020 figures from the Department of Transport (DfT), despite having risen in recent years. In Germany, the figure is 10.1 years, based on 2021 data from the ACEA. It’s even higher in countries in Eastern Europe, reaching 16.8 years in Estonia. Factors reducing the average age include higher numbers of new cars sold, as well as inflated scrappage rates due to incentives or high scrap values.
The overall longevity of cars is increasing as they become more reliable. In 2020, 21% of cars registered for use on Britain’s roads were more than 13 years old, compared with just 7.9% in 2007, according to the DfT.
Stellantis’ Pledge to Reach Net-Zero Emissions by 2038
Stellantis’ pledge to reach net-zero emissions by 2038 is driving the company’s efforts to extend the life of its vehicles. Reusing parts and designing cars to last longer are part of the company’s strategy to reduce its overall CO2 footprint. The company is confident that it can quadruple its remanufacturing business by 2030, from an annual revenue of €528 million (£463m) in 2021 to €2 billion (£1.7bn) by 2030.
Stellantis’ plan to harvest reusable parts from scrapped cars and refurbish used parts and complete vehicles is part of its effort to extend vehicle life. The company is also working on a programme to improve vehicle quality in the design phase to reduce signs of aging and wear and tear, with the intention for the vehicle to look as close to new after years of customer usage as possible.
Car companies’ plans to increase the longevity of vehicles will give the European Union ammunition to push through its disliked Euro 7 emissions proposals, which include a rule to double the length of emissions compliance for ICE cars and vans from 100,000km (62,137 miles) and five years of age to 200,000km (124,274 miles) and 10 years. Car makers will argue that worsening emissions are due to poor maintenance, which they can control in a lease situation in which free maintenance is included.
Conclusion
Stellantis’ efforts to extend the life of its vehicles beyond the current 12-year average is part of the company’s strategy to reduce its overall CO2 footprint and reach net-zero emissions by 2038. The company aims to harvest reusable parts from scrapped cars and refurbish used parts and complete vehicles. Stellantis is confident that it can quadruple its remanufacturing business by 2030, from an annual revenue of €528 million (£463m) in 2021 to €2 billion (£1.7bn) by 2030. Car companies’ plans to increase the longevity of vehicles will give the European Union ammunition to push through its disliked Euro 7 emissions proposals.