Renault targets resource neutrality with dedicated recycling arm

The Renault Group, comprising Alpine, Dacia, Mobilize and Renault, has detailed plans to become resource-neutral and maximise the value of car parts and materials using recycling. The firm aims to generate €2.3 billion (£2.0bn) in turnover annually from its new The Future is Neutral (TFiN) arm, collating the experience of three recycling subsidiaries and its 'Refactory' in Flins, France. The three companies – Gaia, Indra and Boone Comenor – focus on battery diagnostics and recycling, end-of-life vehicle (ELV) treatment and scrap metal recycling, respectively. The Refactory – which specialises in recommissioning used vehicles and already houses Gaia’s parts collection and material recycling operations – will serve as a nerve centre for the operation. A vehicle dismantling line will also be added to the plant, to boost the supply of components to the parts and vehicle refurbishment operations. Renault believes that by bringing each company under a shared banner, it can more effectively recover and exploit the raw materials used to build its cars. Jean-Phillipe Bauhad, CEO of TFiN, said: “In the automotive sector, the first under-exploited resource is the car itself, which is made up of more than 85% of metals and plastics. “The Future is Neutral brings together the expertise to convert this potential into new growth levers. “This new entity aims to push the automotive industry towards resource neutrality, extracting from each vehicle the largest possible amount of material needed to manufacture a new model.” Renault Group CEO Luca de Meo said in a press conference that the 11 million vehicles that end their life each year could provide enough steel, plastic and copper to produce five million brand-new cars. By 2030, TFiN aims to recover three million tonnes of steel, 9000 tonnes of plastics and copper and 4500 tonnes of battery materials annually. The battery operation will begin in 2024. By maximising how much material it can recover from a car, the Renault Group aims to eventually become resource-neutral – completely recovering any new material it adds to the supply chain – drastically reducing its environmental impact and costs. The latter is crucial: TFiN targets a 10% operating margin by 2030. TFiN's services will not just be employed on Renault Group cars but also "all cars from all brands", according to de Meo. In addition, the firm will offer consultancy services on the circular economy to other vehicle makers, as well as training at the Flins ReKnow University. This follows Stellantis’s recently announced plans for its Circular Economy Business Unit to generate annual revenues of €2 billion (£1.7bn) per year by 2030. Remanufacturing is likely to be transformative for the conglomerate’s future business, expanding its product portfolio for minimal cost and supporting new services such as Citroën’s proposed 15-year car leases. Toyota has similar plans to refurbish British cars at its Burnaston factory for its new Kinto arm, extending cars’ lifespans and keeping them within the Toyota network to capitalise on boosted residual values.