How the Circular Economy Action Plan Will Affect the Automotive Industry

circular economy action plan

The European Commission has recently adopted a circular economy action plan to create sustainable growth, protect natural resources, and halt biodiversity loss. It announces a number of initiatives for the entire life cycle of a product, including product design, production processes, and consumer behavior. The ultimate goal of this plan is to minimize waste and keep resources within the EU economy as long as possible. While the plan aims to promote a circular economy, many questions remain, including how the new laws will affect businesses.

EU's circular economy action plan

The European Commission's Circular Economy Action Plan sets out new measures to promote a more sustainable future. These actions include the use of recycled materials, a shift from using raw materials to making products in a circular way. It also includes actions to mobilise private financing. These measures are intended to ensure the EU's continued economic growth while reducing its reliance on foreign raw materials and exposure to the volatility of resource prices. The action plan also sets out new benchmarks for measuring the impact of waste-to-energy conversion.

The Action Plan is still in its early stages and requires a few more stages before it can become law. First, it must pass the European Council and European Parliament and then enter the process of being transposed into national law. Once it has been approved, national governments will have to introduce legislative measures aimed at promoting circularity. These measures will then go through the same processes as ordinary legislation. The EU will continue to work closely with national governments on promoting circularity in their countries.

In addition to reducing consumption footprint, the EU's circular economy action plan will promote sustainable consumption and production. These actions will help the environment, create jobs, and improve economic growth. These initiatives will be developed in close collaboration with all relevant stakeholders. The ambitious measures outlined in the circular economy action plan could boost the EU's GDP by 0.5 percent and create 700,000 new jobs by 2030. These are laudable objectives and we should encourage the development of such a system across Europe.

In addition to the circular economy action plan, the EU is promoting circularity in the construction industry. The Construction Product Regulation, for instance, sets minimum recycled content requirements for certain products. Furthermore, the CEAP sets material recovery targets and material-specific fractions of construction waste. It also promotes green criteria for public procurement in the construction industry. It also aims to ensure that businesses in Europe adopt circularity principles and policies.

Impact on businesses

Implementing a circular economy action plan requires rethinking business as usual. This means rethinking the traditional take-make-dispose cycle and exploring innovative solutions. Realising circularity requires both enabling and limiting supply chain set-ups. In particular, companies will need access to high-quality recycled materials and reliable circular inputs. But these challenges aren't insurmountable.

The transition to the circular economy requires coordinated action from all sectors and policy domains. The Savory Institute, for example, has promoted comprehensive land management, influencing the regeneration of 2.5 million hectares of commercial land around the world. Other initiatives have promoted the reuse and recycling of products for their entire life cycles, and car-sharing business models are one such example. The impact on businesses of a circular economy action plan depends on the degree of adoption in the respective industry sectors.

Companies in the EU face a number of challenges, including the lack of a coherent, sustainable product policy framework. Current circular design requirements only apply to a small number of products, and they are patchy. In addition, key sectors remain largely unaffected by the measures. Financial incentives and infrastructure requirements are necessary to support a successful transition to the circular economy. This new regulatory framework should be based on ecodesign principles and a clear focus on environmental and social benefits.

CIRCelligence has many benefits for companies. The calculator generates quantitative and qualitative insights into the flow of resources into a company, how long those resources remain in the business, and the types of resources that leave the company's boundaries. It also provides recommendations on how to embed circular thinking in the company's business. For example, the use of circular business models can help companies reach new markets, improve market share, and create stronger customer relationships.


A recent Accenture report titled Towards the Circular Economy highlights the potential of the circular economy for the automotive industry, pointing to the potential for companies to double their revenue by 2030 while lowering their costs by as much as fourteen percent. Historically, the circular economy has been translated to the reuse of materials and products, or the remanufacturing of parts and vehicles. It argues that the transition to a circular economy will save net materials costs of $630 billion per year by 2025. In addition, this shift will result in an economic boost for the automotive sector as up to 75% of vehicles will be recycled, and the rest will end up in landfills.

Achieving a circular economy will involve a variety of costs, including the creation of a new model for the construction industry. But, the transition will be rewarding in the long run, as society will benefit from a world where nature and people thrive together. In order to achieve this, however, companies will have to work together to change their behavior and become more efficient consumers. For companies, this means building modular, sustainable buildings and reusing their components.

Increasing the productivity of land will reduce the amount of food wasted and increase the value of the land. By using anaerobic digestion and composting, more biological materials will be moved through the cycle, reducing the need for additional nutrients. And by increasing the energy from material incineration and composting, we'll save resources that would otherwise go to waste. Further, we will be able to reduce the amount of fossil fuels used for energy production.

Crosscutting measures

The EU's Circular Economy Action Plan (CEAP) lays out a series of concrete actions that are designed to shift the EU's economy towards a circular one. This plan outlines goals for product design, production, and consumption, and identifies critical sectors for transition. These sectors include electronics and ICT, batteries, plastics, textiles, food, and construction and buildings. The plan also highlights crosscutting measures that support systemic change.

The government's aim is to help as many manufacturing companies as possible make the transition to a circular economy by 2022. As a way of helping the process, the government is proposing targeted price incentives that encourage manufacturers to use recycled materials and products and provide benefits for both consumers and companies. This includes the use of recycled materials in building materials. The Netherlands has also begun reusing old military equipment, which could be used to build a viaduct.

The government is exploring the concept of expanded producer responsibility, whereby producers could agree to make products more recyclable. Another important aspect of circular design is preventing waste, as modular phone designs are made up of separate components. If a camera in a phone breaks, consumers only need to replace the camera and the rest of the phone remains intact. These are important crosscutting measures in the implementation of a circular economy.

Achieving the EU's targets for reducing waste, increasing resource efficiency, and fostering green growth are important reasons to implement a circular economy. Circularity can create jobs and promote green growth, while reducing the volume of EU waste exported abroad and tackling illegal shipments. In fact, implementing ambitious circular economy measures can increase the EU's GDP by 0.5% and create up to 700,000 jobs.


The EU's Circular Economy Action Plan sets out to close the loop on waste, implement innovative solutions, and promote the use of reclaimed resources and products. The European Union will invest approximately 1 billion Euros in circular economy projects, including many water-related projects. The plan highlights the importance of developing services and addressing various value chains, including those in the mining industry. The European Commission's Action Plan highlights the importance of recycling reclaimed water, a key issue for many businesses and individuals.

The European Commission's Circular Economy Action Plan is aimed at stimulating the transition to a circular economy and to boost the competitiveness of EU companies globally. By 2050, the EU plans to achieve a carbon-neutral, sustainable, and toxic-free economy. The plan signals to economic players that Europe is committed to making the necessary changes to its economy. It also opens up new business opportunities and improves European competitiveness.

The circular economy action plan targets several key areas, including the reuse of materials, the prevention of pollution, and promoting sustainable consumption. The European Commission also adopted four legislative proposals on waste, including new obligations to recycle biowaste. The circular economy is a valuable resource in preserving biodiversity and ensuring the future of human and planetary health. The EU has been making progress in this area, but it is still far from reaching its full potential.

The European Commission's Circular Economy Action Plan targets are not yet set in stone, but the EC has already published a working document for stakeholder consultation. The COR's ENVE committee is soliciting input from stakeholders. Written comments are being accepted until May 29th 2020. This is an important time for the EU to address environmental and climate-change challenges in its production and consumption. A good way to get started is by investing in a circular economy action plan.

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