The emergence of digital technology and social media has given consumers more power than ever before. With smart devices connecting every aspect of their lives, they are increasingly controlling how and where they engage with companies. With increased access to information and transactions occurring in real time, consumers have come to expect more, making it harder for businesses to keep up. Greater trust, convenience, and a sense of community are pushing the adoption of the sharing economy forward. Lower entry barriers for technology are resulting in rapid innovation and this is expected to speed up in the future. These trends are having an significant impact on the automotive industry.
"Private ownership of cars will disappear - though not completely - and cars will be owned by the manufacturer in the next 10-15 years. This will result in fewer cars, due to the fact that cars will be more heavily utilised through sharing."- Thijs Jasink - COO, ACtronics
The growing role of consumers is transforming the function of cars, making them smarter and more connected. The ever more rapid development cycles of new products and services and increasing technological complexity, require a complete restructuring of the automotive supply chain. As a result, car manufacturers are pursuing new differentiation strategies and engaging with their supply chains in order to meet these new, consumer demands.
"Suppliers need to be able to adapt to these changes quickly in order to stay relevant and avoid becoming the ‘Kodak’ of the automotive industry."- Ralph Ramaekers - Marketing Director Automotive, DSM Engineering Plastics
The report On the Road to the Circular Car, published by ABN AMRO and Circle Economy argues that car parts manufacturers are in a unique position to answer to these rapidly changing and increasingly dominant consumer demands by adopting circular strategies.
"Together with ABN AMRO and industry leaders we have created a vision for the automotive sector, showing them that by introducing circularity into their manufacturing practices and business models they can become future proof and stay successful in a fast paced, ever-changing industry".- Marc de Wit - Director of Strategic Alliances, Circle Economy
Circular strategies include using materials that can be easily reused, integrating modularity into the design of the car in order to make quick and affordable repairs and upgrades and shifting ownership so that car manufacturers remain owners of the cars themselves.
"Consumer needs require new business models that radically alter the traditional automotive chain. We have to redesign the car completely and reorganise the chain". - Jan-Paul Kimmel, CLAUT
To drive successful innovation, the automotive industry needs to collaborate across the entire value chain; this is where bottom-up, circular innovation from parts and component suppliers will play a crucial role.
Read the full report featuring examples of leading circular innovators and recommendations on how to future proof the Dutch automotive industry with circular business strategies through the link below.
The emergence of digital technology and social media has given consumers more power than ever before. With smart devices connecting every aspect of their lives, they are increasingly controlling how and where they engage with companies. With increased access to information and transactions occurring in real time, consumers have come to expect more, making it harder for businesses to keep up. Greater trust, convenience, and a sense of community are pushing the adoption of the sharing economy forward. Lower entry barriers for technology are resulting in rapid innovation and this is expected to speed up in the future. These trends are having an significant impact on the automotive industry.
Around 600 trucks full of solid waste are incinerated in the greater Amsterdam region daily. The residue from this incineration process is known as bottom ash. If separated properly, the ash can provide valuable metal and mineral resources that can be used as a raw material input. However, the ash must be cooled by wet extraction making it sticky and difficult to separate its components. Due to the complicated separation process the ash is usually sent to landfills where the valuable materials within the mixture become useless.
Inashco's team realized that the extensive amount of value being disposed of each day could be reintroduced into the supply chain if the metals and minerals were extracted properly from the incinerator's ash residue.
“With our strong fundament of shareholders and partners, Inashco has the capabilities and ambition to close the loop of the Waste to Energy sector and so reducing the need for primary mining.” - Arno de la Haye, CEO, Inashco
Founded 8 years ago, in close cooperation with the Technical University Delft, Inashco developed a breakthrough technology which separates metal particles, such as aluminum, copper, and iron, from the ash based on weight. A magnetic current then categorizes the metals based on their magnetic properties. The resulting stable, long-lasting, metal scraps and stronger, more porous cement mixtures meet the reusability requirements established by local laws allowing for these recycled materials to be continuously circulated throughout the supply chain.
https://vimeo.com/174175783
Operating worldwide with over 200 employees, Inashco's team now processes over 4 million tonnes of bottom ash from municipal waste incineration annually. Valuable metals and minerals are reintroduced into the supply chain, preserving our earth’ valuable natural resources and thanks to Inashco’s technology, landfilling is no longer needed to dispose of the City of Amsterdam’s waste.
The process has maximized the output of urban mine’s, eliminating sludge being sent to landfills, reducing CO2 emissions by bringing valuable raw materials back into the economy and creating recycling jobs, thus providing a comprehensive positive impact on the economic, environmental and social spheres of the industry.
“We believe that the key to success is the combination of advanced technology and the access to metal markets worldwide.” - Business Development Director, Inashco
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The ownership of assets has long been the way in which companies maintain their operations; however when analysing the usage statistics of these assets they tend to remain idle more often than they are used. The concept of a sharing economy is one that helps bring circularity to life and provides a way for assets such as machinery, equipment, facilities and even personnel to be utilized to their fullest. Although ideal, the biggest challenge in implementing such an economy is connecting these idle assets with companies that can put them to use. With a goal of providing a solution to this challenge, FLOOW2 developed the “world’s reset button” to provide a sharing marketplace for business equipment and services.
By creating an online platform FLOOW2 was able to establish an easy to use marketplace for the efficient and transparent exchange of assets, becoming the first company in the world to offer businesses and institutions a new way to pay-off their assets. Asset owners post their equipment, machinery, facilities, services or expertise on the marketplace and buyers who would like to use or purchase the assets can execute a rental agreement or sale through the website.
FLOOW2’s sharing marketplace prevents the overcapacity of equipment, machinery, and facilities, by bringing together already existing supply and demand while reducing the demand for new assets. The business model illustrates the benefits of the sharing economy and solidifies the fact that this concept can be applied to B2B business models.
The implementation of such a marketplace requires extensive effort to raise awareness for the online platform and convert users. At the moment about 35.000 advertisements are posted on the marketplace however, the biggest challenge is teaching companies the benefits of a sharing economy compared to asset ownership.
The marketplace brings greater turnover and a more efficient allocation of resources. With ambitions to become accessible worldwide, FLOOW2 is developing a unique exchange platform to target the healthcare sector which has more expiry dates on products than other sectors. Such a platform will be able to reallocate medical technologies that have become obsolete, to hospitals that can make use of the older equipment, especially those in developing countries.
“The circular economy forces all of us to think and act differently. The mind shift from access over ownership will enable business owners around the world to experience significant financial, sustainable and social benefits. Asset sharing will be the key in development towards a more circular economy in the business-to-business environment.”
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A great synergy exists between SkyNRG and Circle Economy since both organisations are dedicated to build and encourage the development of sustainable business models. Together SkyNRG and Circle Economy will explore opportunities to make the aviation sector more circular.
SkyNRG takes up a pioneering position in realising a long-term sustainable future for the aviation industry. They are specialised in supplying sustainable jet fuel from waste streams like used cooking oil. This alternative source for conventional jet fuel can offer CO2 emission reductions of up to 80%, compared to fossil jet fuel. SkyNRG has already achieved great success in supplying their sustainable jet fuel for example to the customers within KLM's Corporate BioFuel Programme for example. This programme was launched in 2012 and offers KLM corporate clients to reduce their business travel footprint by flying on sustainable jet fuel.
“Circle Economy and SkyNRG both understand that in order to realise a circular economy, engagement of all stakeholders, including governments, businesses, industry and end-customers, is crucial. We are proud to be part of the Circle Economy network and look forward to a successful partnership.”- Maarten van Dijk, CEO SkyNRG
“We are very happy to have SkyNRG on board. As the global leader for sustainable jet fuel, they are in the position to accelerate the transition to the circular economy in a practical and scalable way, in particular in the very important airline industry, where much progress is to be made.”- Andy Ridley, CEO Circle Economy
The climate conference in Paris has produced a landmark agreement. The emission reduction commitments made by 195 countries are a leap forward, but not yet sufficient to stay on a 2 °C trajectory, let alone a 1.5 °C pathway. Current commitments address only half the gap between business as usual and the 1.5 °C pathway. There is still a reduction of about 15 billion tonnes CO2e needed to reach the 1.5 °C target. Further solutions are therefore needed; solutions that go beyond decarbonising our energy system. Since over half of the worldwide greenhouse gas emissions are associated with producing basic materials, there is a clear role for circular economy strategies in reducing this gap.
The City of Glasgow is on the road to becoming one of the world's first circular cities. The city has taken its first steps in creating a stronger more sustainable economy by completing the Circle City Scan. Commissioned through a partnership between Glasgow Chamber of Commerce, Zero Waste Scotland and Glasgow City Council, an analysis of the city’s material flows was executed by Circle Economy.
This pioneering study of Glasgow’s economy, identified leading industries through which the city’s economy can become more ‘circular’ and defined implementation strategies and opportunities for the region’s business community. The goal of the Circle City Scan is to pinpoint areas in which the city of Glasgow can benefit from new collaborations, create market opportunities and increase profits, while reducing the city’s environmental impact. The resulting report highlights sectors in which circular business models can be applied and specifies strategies to accomplish the practical and scalable implementation of these circular solutions.
The creation of products and services requires the use of resources in the form of materials, energy, and labour. As a product is produced value is added as more materials, energy, and labour are utilised in the production process. Once the product reaches its end-of-use however, the value created during the production process is almost completely lost due to current waste management practices. Resources that could otherwise be recycled and reused are simply disposed of or incinerated. As a result, more raw materials are required in order to meet the ever growing product needs of consumers.
High value reuse within a circular economy restores products and preserves resources that have reached their end-of-use back to their original state to deliver the same or even improved functions. In this way, the value of products are preserved, reducing the level of risk and costs associated with raw material price volatility and scarcity.
The aim of high value reuse is to preserve the value of materials by:
Special thanks to our panelists who provided great practical examples of how they have integrated high value reuse strategies to their business models!
Circle Economy’s quarterly Deep Dives on sector or industry based topics are part of the membership offering. They are an excellent way to meet with other members, share insights, learnings and real life issues on dedicated topics, and contribute to creating business opportunities between members.
Interested in becoming a member?
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https://vimeo.com/167694724
“This is the first generation of people who really understand climate change, and the last ones who can really do anything about it.” - Former President of Ireland, Mary Robinson, quoted by Dilys Williams, Director of the Centre for Sustainable Fashion
For the three days, over 100 students, from 40 nations, gathered together in the dappled courtyards and halls of the The Royal Danish Academy to unpack and reinterpret the 17 UN Sustainable Development Goals. Their mission was to devise seven demands on the fashion industry, which would be presented at the Concert Hall, only two days later.
This was no easy feat, especially for a diverse group of perfect strangers. As facilitator for the circularity working group, Project Manager of Circle Economy's Circle Textiles Team, Gwen Cunningham saw, first hand, how they grappled to come to terms with these complex topics during the intensive workshop days. The driving questions emerged; can the fashion industry be a vehicle for change? How can we harness it’s spark, it’s creativity and it’s omnipresence, to address issues surrounding the environment, climate change, ethics and workers’ rights and welfare.
What rang clear was the total, unanimous agreement that the fashion industry was due for a major overhaul and that this next generation has no interest in inheriting the industry, as is. Their passion and unwavering clarity on the need for change kept the energy at fever-pitch and translated into powerful statements of intent, that industry judges called ‘presidential’, ‘eloquent’ and ‘purposeful’.
Picture by Gianluca Mazzarolo from GM Creative Studio
“Thank you for the work you do- the students’ ideas are changing the game” - Angela Snow, Senior Director, Global Design, Culture and Community, Nike
During a productive evening of workshops, networking, and panel discussions including Claire Bergkamp, Head of Sustainability and Ethical Trade at Stella McCartney, Angela Snow, Senior Director of Global Design, Culture and Community and Nike and Caroline Kahn Manager of Product Sustainability at Nike three core take-aways emerged:
Picture by Gianluca Mazzarolo from GM Creative Studio
“This idea of a sustainable ‘journey’ is killing us. It’s not a journey, it’s a mission’ - Linda Greer, Scientist, National Resources Defence Council
Fighting Summit fatigue, we forged our way to the largest and the last event of the week; the Copenhagen Fashion Summit. Over 1.200 attendees, from 52 countries joined, including senior sustainability leaders from G-Star, Nike, Filippa K, Stella McCartney, H&M, as well as noted individuals such as Suzy Menkes, Renzo Rosso and Vanessa Friedman.
With such a vast and specialised audience, the risk of preaching to the converted was high. Nike and Patagonia emerged as clear highlights, sharing commitments to circular solutions, with Hannah Jones confessing that she ‘never knew she would love waste so much!”.
Livia Firth was a solid favourite too, bravely calling attention to the ‘elephant in the room’; the fast fashion business model on which we still depend. “Because the impact, the pace, the volume and the economics pre-ordained by this current business model – will not get us to the point we want to get to: one where producers are in partnership with brands, rather than in servitude to them.”
Yet as her passionate voice reverberated from the walls of the concert hall, we were left wondering where is the discussion in these moments? What good is a lone speaker at a lonely podium, when what’s desperately needed, and repeatedly called for throughout the course of the day, is industry collaboration, critical conversation and clear consensus?
Indeed, the highlight was the rallying cry of the next generation who boldly demanded change, and outlined solution-driven actions. You can read their entire manifesto here. May we not only listen and learn but take action.