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BMW and the circular economy: bringing another way of implementing sustainability

Joana Grancho
Market Monday March 11th 2024

The circular economy is an economic concept that is part of sustainable development in which economy and sustainability are combined. In this case, BMW, in order to minimise waste and maximise resource efficiency, has implemented circular economy practices throughout its value chain, thus leading the way in the automotive industry. 

For BMW, saving resources is one of the main objectives, with four principles of the circular economy: rethink, reduce, reuse, and recycle. To implement them, it was necessary to recognise the importance of sustainability in its operations, i.e. to include the use of recycled and renewable materials in its vehicles, such as electric car batteries (around 90% of the materials in these are recyclable), as well as the installation of more efficient manufacturing processes (in terms of energy and resources) among other productive factors. You can see this new adaptation on the brand’s website. In addition, BMW has invested in the collection of recyclable materials, so it aims to minimise waste throughout the life cycle of its products. The latest innovation that combines the four fundamentals of this economy is the new BMW iVision, which has been designed entirely following these principles.

As for the economic benefits for the brand, the adoption of these practices leads to a reduction in the consumption of virgin raw materials, energy efficiency and waste reduction, which can increase BMW’s productivity and competitiveness in the automotive market.

On the other hand, recycling complex materials, such as lithium-ion batteries, can be technically challenging and economically expensive. However, these challenges also represent opportunities for innovation and the development of new technologies that can further promote the company’s prominence.

At the level of the global economy, by promoting sustainable practices in its value chain, it encourages other brands to adopt similar approaches so as not to fall behind in the race, implying an increase in brand rivalry, in this case, Mercedes-Benz, BMW’s main competitor.

Finally, as BMW and other companies continue to move towards innovation, it is clear that this method is redefining standards in the automotive industry. For, as well as providing economic benefits such as cost savings and increased competitiveness, the circular economy is introducing a profound change in how entrepreneurs think, placing sustainability at the centre of business operations.

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