In 2023, the European Commission proposed stringent regulations requiring motor manufacturers to ensure that, by 2031, at least 25% of the plastic used in new vehicles must be derived from recycled materials. Failure to comply could result in new vehicles being barred from sale within the European Union (EU). This move has set off a scramble among automotive companies worldwide to re-engineer their production processes and supply chains.
Honda and Nissan have now announced plans to establish a supply chain for recycled plastics, aiming to enhance the environmental sustainability of their vehicles and comply with these looming European regulations.
It’s a Challenge
Currently, only about 3% of all recycled plastics are repurposed into automotive parts in Japan, according to data from Tokyo’s Plastic Waste Management Institute. The process of segregating different plastic types from end-of-life vehicles remains labour-intensive and time-consuming, challenging efficient recycling efforts.
Honda’s Initiative
Honda is pioneering efforts to establish a recycled plastic supply chain by 2040. The company plans to collaborate with chemical manufacturers and recycling firms to streamline the process. One of their goals is to reduce the varieties of plastic used in new cars by almost 60%, targeting six or seven primary types to simplify sorting at recycling facilities. The mass-produced electric vehicle Honda e currently uses around 25 different types of plastics.
For this endeavor, Honda is enlisting the expertise of Mitsubishi Chemical Group and Toray Industries to convert collected plastics into automobile-grade materials. These partnerships aim to refine recycled plastic quality to meet existing standards, mitigating issues like contamination that can impair material strength.
Even a very small vehicle like the Honda e currently uses around 25 different types of plastics.
Efforts by Other Automakers
Nissan and its partner Renault are planning to initiate the recycling of plastics from retired electric vehicles (EVs) to be used in new car assemblies in Europe. Nissan is considering an investment in Renault’s recycling unit, with further details on the investment scale yet to be finalized.
Meanwhile, Toyota Motor Corporation has set ambitious targets to ensure that by 2030, recycled plastics constitute at least 30% of the plastics used in new vehicles, both in Japan and Europe, based on weight. Notable efforts include using fabric from collected plastic bottles for the seats in its Land Cruiser 250 series and doubling the recycled plastic use in the small SUV C-HR sold in Europe compared to its predecessor.
Subaru is also setting goals, aiming for recycled materials to make up at least 25% of the plastics used in new models globally by 2030.
Toyota is using fabric from collected plastic bottles for the seats in its Land Cruiser 250 series.
Economic Hurdles and Support
The higher cost of recycled plastics poses a significant barrier to widespread adoption in automotive parts. Recycled plastics can be twice to three times the cost of conventional plastics.
In response, the Japanese government is set to launch a public-private enterprise as early as this September to support these initiatives. With the Ministry of the Environment coordinating, this conglomerate will include around 10 organizations, such as the Japan Automobile Manufacturers Association—which counts Toyota and Honda among its members—and the Plastic Waste Management Institute. This entity will collaborate across numerous areas, including the supply of recycled plastics, and the ministry is contemplating necessary investments.
Global Impact and Industry Projections
Automakers globally are reacting to regulatory pressures, with brands like Mercedes-Benz and BMW already increasing the use of recycled plastics. Research firm MarketsandMarkets projects that the recycled materials market for cars, including plastics, will expand by approximately 60% from 2022 levels, reaching an estimated value of $3.9 billion by 2027.
This focus on recycled plastics is a testament to the automotive industry’s dedication to sustainability in the face of global regulatory changes, promising a marked shift in manufacturing practices and supply chain dynamics in the coming decades.
