A new division of the maker of Jeep SUVs and Ram pickup trucks has the mission of ensuring the vehicles and their parts last as long as possible as the industry battles parts constraints and fears of electric-vehicle battery shortages in the future.
Stellantis NV's "circular economy" business unit is one of seven pillars of the automaker's Dare Forward business plan announced in March. It forecasts efforts around reusing and recycling parts, including EV batteries, will result in more than $1.9 billion (2 billion euro) in annual revenue at the end of the decade and help it to achieve its net-zero carbon goal by 2038. That's a quadrupling of extended-life revenues and 10 times the recycling income of 2021.
"Before now, we have had great teams doing great work all around the company, effectively contributing to using our waste and using our scarce resources as smart and as efficiently as possible," CEO Carlos Tavares said in a recorded video statement. "Across the world, we have been doing the work, but now we are pushing into overdrive at high voltage and the dedicated business unit has a clear plan to both meet our ethical responsibilities for our collective future and to bring financial value to Stellantis."
In addition to additional revenue and savings on carbon emissions, the operations also may help to deliver vehicles faster in the future, while also shoring up supply chains. They also give customers cheaper, more sustainable options that the company says offer the same quality and warranties. The emphasis is on affecting the designing of new products and the company's purchasing department, said Alison Jones, Stellantis' senior vice president of the circular economy business unit.
"In circular economy," she said, "rather than disposing of items or products when you finished with them or they're broken, the idea is that you either repair them so that you can extend the life and continue to reuse them, or you pass them or sell them on to somebody else or they go to somebody who can actually break them up and use those materials and reinvest that into a manufacturing process somewhere else."
The division focuses on four Rs: reman, repair, reuse and recycle. To reman a product is to dismantle used or defective parts, clean them and remanufacture them to the specifications required by the automaker. Revenues from this area alone represent 95% of revenues from the Rs currently, and they are expected to increase 31% year-over-year in 2022. EV batteries are one of 12,000 parts covering 40 product lines available for this process.
Worn parts may also be repaired and installed again into a customer's vehicle. Stellantis says the life of its batteries is more than 10 years and increasing, but at 21 locations like in Russelsheim, Germany, e-repair centers can work on EV batteries, replacing modules that may not be working as they once had.
When vehicles are at the end of their life, parts can be recovered. The company has about 4.5 million parts in inventory across brands that it can sell in 155 countries through the automaker's B-Parts platform acquired in 2020. Reuse also refers to second-life applications for parts like batteries in non-automotive applications. Parts additionally may join production scraps in being fed back into the manufacturing process either by Stellantis itself or partners. In the first six months of the year, the company has recycled 1 million parts.
Jones added that the nearly $2 billion in annual revenue expected from the efforts only encompasses direct revenues. So that won't reflect, for example, parts that may be recycled for raw materials and used again by Stellantis. Plus, the recycling of batteries won't become a significant portion of the business until 2030 and beyond.
Reman and recycle operations have begun in North America with activities around all four Rs expected to be active by 2030. Repairing activities are underway at the Detroit Assembly Complex, and a center in Memphis, Tennessee, collects used materials for their raw materials. Jones pointed to replacement transmissions and engines, particularly Hemis, as big examples in the United States. Repaired equipment may save customers 10% to 30%.
The company last month said its first circular economy hub will launch next year at its Mirafiori manufacturing complex in Italy. It'll support the "cradle-to-cradle" business model in Europe with vehicle reconditioning, vehicle dismantling, and parts remanufacturing activities. The scope will expand globally. European online used car retailer Aramis, which the automaker acquired in 2016, also will have seven refurbishing centers on the continent by the end of the year.
In addition to hubs addressing these services, "local loops" seek to keep products and materials within countries and speed deliveries to customers. In Brazil, Stellantis remanufactures starter motors and alternators and sells them across 1,000 dealerships.
Transparency also is a part of this process. The automaker is launching a "SUSTAINera" label on parts and accessories, an idea chosen from hundreds of Stellantis employee proposals. It will replace Mopar's reman arm. It indicates savings of up to 80% materials and 50% energy compared to equivalent new parts. Environmental, social and governance performance software from Chicago-based Sphera Solutions Inc. determines the values through a life-cycle analysis.
Details on the efforts come a day after Stellantis announced a non-binding memorandum of understanding with GME Resources Limited, a supplier of nickel and cobalt needed for EV batteries. Rivals General Motors Co. and Ford Motor Co. also have made investments in startups to help with battery recycling.
Stellantis pointed to the electric Citroën Oli (all-ë) concept as an example of implementation of the business unit's works. Revealed last month, the Oli seeks to achieve a "best-in-class" lifecycle assessment with fewer and recycled materials. A reduced weight target of almost 2,205 pounds (1000 kilograms) offers almost 250 miles of range (400 kilometers) with a 40 kilowatt-hour battery. With a top speed of 68 mph (110 kilometers per hour) to obtain the best efficiency, the company says the vehicle can be charged from 20% to 80% in around 23 minutes.
"Three societal conflicts are happening simultaneously," Citroën CEO Vincent Cobée said in a statement at the time regarding the timing of the Oli. "First is the value of and dependence on mobility, second is economic constraints and resource uncertainty, and third is our growing sense of desire for a responsible and optimistic future. Consumers can sense the era of abundance may be over and increasing regulations as well as rising costs may limit our ability to move around freely. At the same time, a growing awareness of the need to accelerate efforts to prevent climate change is making us more eco-conscious and discerning."
Jones emphasized the need to increase awareness through Stellantis' dealer network on the more sustainable options.
"We would predominately do it in North America to be able to demonstrate we have this solution," she said. "It drives support for reuse of scarce resources of our planet."
