Stellantis Targets Vehicle Production Using 35 Percent Recycled Materials

Stellantis has set a target to increase revenue from its recycling business (photo; Twitter @StellantisIT)

JAKARTA - Stellantis will seek to increase its medium-term target for the minimum percentage of recycled materials in its vehicles to 35%. This was revealed by Senior Vice President of Global Circular Economy, Alison Jones, Tuesday, October 11.

In its business plan, Stellantis has set a target to increase revenues from its recycling business tenfold to more than 2 billion euros by 2030. It also aims to double revenues from long-lived parts and services.

"We're talking about a target of at least 35% recycled material in our vehicles, that's going to vary by vehicle," Jones said.

"Of course, we will try to increase it, because we want to make sure that we take more material and put it back in our vehicles going forward," he added, without elaborating on what percentage that might go up.

Presenting the Stellantis Circular Economy business at an online press conference, Jones said the project - based on "reman", "remedial", "reuse" and "recycling" - would help the automaker group meet its net zero carbon target set by 2038.

It will also help the world's fourth-largest automaker to keep prices lower as the shift to electrification often means more expensive vehicles, and address the potential for prolonged shortages of raw materials in its supply chain.

Stellantis CEO, Carlos Tavares, said raw material shortages will continue in the next decade. It adds ha; it is a major task for automakers to extend the life of the materials they use.

Demand is growing worldwide for recycled materials as manufacturers, from automakers to fashion companies, strive to meet their green targets. This often makes recycled materials more expensive than new ones.

"We're focused on getting the whole circular loop working, so we have those materials in our circle and we're not subject to material price fluctuations," says Jones.

He adds that "remanufactured" Stellantis components are typically 10% to 30% cheaper than the original, thanks to reduced raw material and energy use.

Jones said the development of a circular economy business could lead to an M&A deal as Stellantis seeks to increase its range of skills and expertise, as well as develop it internally.

Stellantis has chosen the Mirafiori complex in Turin to launch its main circular economy center next year, focusing on the reconditioning and dismantling of vehicles and the reuse of used components.

The circular economy center will run alongside the "local loop", allowing products and materials to stay within the country and speed up business.