Driving Ambitions: The Business Case for Circular Economy in the Car Industry

The report argues that a circular economy can increase automotive value chain profitability by 1.5 times and generate lifetime revenues per vehicle 15–20 times the original sales price. This shift is primarily driven by as-a-service models and life cycle services, which maximize vehicle performance and lifetime. The document outlines a transition from 'building vehicles to building services,' requiring a 'value chain orchestrator' to manage data transparency and collaboration. Environmental benefits include reducing carbon emissions by up to 75% and resource consumption by up to 80% per passenger km by 2030.

• Transitioning to a fully circular value chain can significantly expand financial returns, with lifetime revenues per vehicle reaching 15–20 times the sales price and overall value chain profitability increasing by approximately 1.5 times.
• The most significant value pools in a circular model are found in as-a-service offerings (such as MaaS and car sharing) and life cycle services (repair, remanufacturing, and recycling), with as-a-service models potentially providing up to 15 times the profits of traditional production and sales.
• Circular design choices create cross-value chain synergies; for instance, investing in modular vehicle design can lead to profits in repair workshops 1.5–4 times the initial cost and profit improvements in end-of-life recycling 2–5 times the cost.
• Technological advancements in recycling can drastically increase the revenue from end-of-life vehicle processing, rising from current levels of €200–500 to between €8,000 and €13,000 per vehicle.
• A circular automotive value chain is essential for meeting aggressive sustainability targets, specifically reducing resource consumption by up to 80% and carbon emissions by up to 75% per passenger kilometre by 2030.
• The transition requires a 'value chain orchestrator'—potentially an OEM—to establish common frameworks, standards, and data transparency to align stakeholders and manage the distribution of costs and benefits.
• The cost of capital is a critical factor for full-lifetime leasing models, where a 1 percentage point increase in capital costs reduces profitability by about 1 percentage point; however, this impact is significantly lower for high-use models like MaaS.

APA

World Economic Forum (2022). Driving Ambitions: The Business Case for Circular Economy in the Car Industry. https://www3.weforum.org/docs/WEF_Driving_Ambitions-2022.pdf

Chicago

World Economic Forum. Driving Ambitions: The Business Case for Circular Economy in the Car Industry. 2022. https://www3.weforum.org/docs/WEF_Driving_Ambitions-2022.pdf.

Wikipedia

{{cite report |author=World Economic Forum |title=Driving Ambitions: The Business Case for Circular Economy in the Car Industry |date=May 2022 |url=https://www3.weforum.org/docs/WEF_Driving_Ambitions-2022.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{worldeconomicforum2022driving, author = {{World Economic Forum}}, title = {{Driving Ambitions: The Business Case for Circular Economy in the Car Industry}}, institution = {World Economic Forum}, year = {2022}, month = may, url = {https://www3.weforum.org/docs/WEF_Driving_Ambitions-2022.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }