EMs face increasing pressure to cut their environmental impact.
This means reducing their carbon footprint, but also their raw material and resources consumption, and making their operations and business model more sustainable (not focused solely on selling more and more cars). In response, OEMs are starting to put in place Refurbish, Remanufacture, Reuse, and Recycle (R4 or the “4Rs”) strategies to maximize their reuse of valuable materials.
Source: Berylls Strategy Advisors
However, their strategies are at the moment neither comprehensive nor consistent. On the one hand, they usually focus on end-of-life applications, such as recycling and reuse of vehicles and battery modules. Recycling and reuse are the “2Rs” that appear to be the most profitable at present (if you want to learn more, please also have a look on Berylls’ Battery Re-X study. On the other hand they tend not to consider an important prerequisite for their strategies: Being the legal owner of the vehicle throughout and particularly at the end of its lifetime (around 8-10 years).
During the 8-10 year period, OEMs will need to redeploy the car to different end customers for different types of contract, as part of a multi-cycle Vehicle-as-a-Service (VaaS) sales model, rather than selling the car outright when it is new (if you want to learn more about the Berylls point-of-view on VaaS, please have a look on our dedicated website.
This multi-cycle sales model will put vehicle condition in the spotlight, as it will be essential to maintain a certain standard of quality so the car is available for as many types of business models as possible.
Source: Berylls Strategy Advisors
Efficient refurbishment operations to maintain the quality of vehicles between different use cycles will therefore become a strategic enabler for both multi-cycle sales models and for OEMs’ holistic 4R strategies.
We believe that taking a lifetime view of vehicles and components has significant strategic and commercial benefits
Source: Berylls Strategy Advisors
THE IMPORTANCE OF 4R STRATEGIES in the context of business model and sustainability transformation is increasing rapidly and only few players are starting to get prepared. Now is the time to decide whether to bea pioneer or a laggard in two of the most relevant future fields of action!
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