To overcome challenges to achieving circularity, it will be necessary for players along the automotive value chain to establish a common language related to the circular economy and relevant business models. The transformation will be decadal rather than short-term—and the ecosystem needs to come together around a common understanding of where to go.
Our study, together with 40 companies from the automotive value chain, proposes a taxonomy with five levels of circularity based on our two primary measures (carbon and resource efficiency) to evaluate and improve the circularity of cars. The proposed levels range from single owner use and disposal (Level 0) to an aspirational goal of an automobility ecosystem that has net positive impacts (Level 5). The levels describe vehicles that are part of an increasingly circular automobility system. Each level can be determined based on characteristics of both the product and its use. Thus both the producer and the owner of the car are responsible for achieving circularity.
This framework is intended to serve as the basis for further discussion and refinement of ideas throughout the industry: