In order to address global warming, the adoption of circular economy practices combined with accelerated electrification in the automotive industry has the potential to reduce carbon emissions by up to 75 per cent by 2030, a new Accenture-World Economic Forum (WEF) report said on Tuesday.
The move can also help cut non-circular resource consumption by up to 80 per cent per mile by 2030.
According to an Accenture analysis, mobility demand in terms of both passenger miles and predicted vehicle stock is expected to increase 70 per cent globally in the next decade.
The automotive industry can prepare for this demand, while also decarbonising to contribute to limiting global warming to less than 1.5 degree Celsius, by achieving circularity through the lens of energy, water, waste, materials, vehicle lifetime and use.
“Circular cars will be a key building block to serve the growing mobility demand, while, at the same time, reducing resource consumption and carbon emissions to a level that is truly sustainable,” said Axel Schmidt, a senior managing director at Accenture who leads its Automotive industry group globally.
“While many vehicle manufacturers have already set net-zero goals toward carbon neutrality, the roadmap for automotive circularity must be a core element of this transformation and ambition.”
The circular car is now on its way to becoming a core component of the automotive future.
“Companies across the industry must consider how technology and business levers can maximize the resource value of the car, minimize life-cycle emissions and unlock new opportunities along the value chain,” said Christoph Wolff, global head of mobility and member of the executive committee at the WEF.
The primary barriers to circularity in the automotive industry are related to customers and use patterns, business models, production methods and technology, and regulatory hurdles.
“The automotive industry along with the mobility sector will have to profoundly change if it is to provide for the forecasted 2.5x fold increase in road transport demand by 2050 at net-zero carbon emissions”, said Thomas Deloison, director of mobility, World Business Council for Sustainable Development.