BMW Group’s Neue Klasse lineup to focus on circular economy to achieve reduction in CO2 emissions

The BMW Group announced Thursday its intentions to commit to a 50% reduction from 2019 levels in global carbon dioxide emissions during the use-phase of its vehicles by 2030, as well as a 40% reduction in emissions during the life cycle of the vehicle. These goals, including a plan to focus on the principles of a circular economy to achieve a more sustainable vehicle life cycle, will manifest in the company’s Neue Klasse platform, which should be available by 2025.

Announced in March, the BMW “New Class” is a reboot of a line of sedans and coupes the German automaker produced from 1962-1977, a line that established BMW’s identity as a sports car manufacturer. The new line will feature “a completely redefined IT and software architecture, a new generation of high-performance electric drivetrains and batteries and a radically new approach to sustainability across the entire vehicle life cycle,” according to the company.

“With the Neue Klasse we are significantly sharpening our commitment and also committing ourselves to a clear course for achieving the 1.5 degree target,” said Oliver Zipse, chairman of the board of management of BMW AG, in a statement. “How companies are dealing with CO2 emissions has become a major factor when it comes to judging corporate action. The decisive factor in the fight against global warming is how strongly we can improve the carbon footprint of vehicles over their entire life span. This is why we are setting ourselves transparent and ambitious goals for the substantial reduction of CO2 emissions; these are validated by the Science Based Targets Initiative and will deliver an effective and measurable contribution.”

BMW says the utilization phase of its vehicles accounts for 70% of the group’s total CO2 footprint, which makes sense given the fact that most of BMW’s car sales are still ICE vehicles. In the first half of 2021, about 11.44% of BMW’s total sales volume were either electric or plug-in hybrid, according to its 2021 half-year earnings report. The company has expressed a goal of selling 1 million plug-in units, including hybrids, by the end of 2021. As of Q2, it’s already at around 850,000, but in order to reach its goal of halving emissions during the utilization phase, BMW will need to seriously up its sales of low or zero-emissions vehicles. BMW already has its i3 compact EV out and plans to launch two long-range models, the i4 sedan and iX SUV, later this year, with plans for more in 2022. But unlike GM or Volvo, the automaker has not yet announced plans to kill its ICE vehicles, nor has it begun to sell a full line of vehicles designed from the ground up to run on batteries.

This announcement comes just a couple of months after BMW, along with other German automakers Volkswagen, Audi and Porsche, acknowledged its involvement in colluding on an emissions cartel since the 1990s. The automakers collectively hid technology that would have been able to reduce harmful emissions beyond what was legally required under EU emissions standards. The EU fined BMW $442 million, a slap on the wrist given BMW’s second-quarter profits of close to $6 billion.

In addition, the EU’s “Fit for 55” energy and climate package, which was released last month, upgraded the overall carbon emissions reductions goal from 40% to 55% by 2030, which means automakers need to pick up the pace of electrification, and BMW knows that. Other proposals reportedly under discussion in the European Commission involve a 60% emissions reduction by 2030, followed by 100% cut by 2035, which would make it near impossible to sell ICE vehicles by that time.

BMW says its Neue Klasse will further the momentum to get EVs to market. The automaker aims to have 10 million all-electric cars on the road over the next decade, with at least half of all BMW Group sales being all-electric and the Mini brand offering exclusively all-electric from 2030. As part of its circular economy focus, BMW also intends to incorporate an increase of use of secondary materials and promote a better framework for establishing a market for secondary materials with the Neue Klasse. The company says it aims to raise the percentage of secondary materials it uses from its current rate of 30% to 50%, but didn’t specify by when.

BMW says its use of secondary nickel in the iX battery, for example, is already 50%, with the battery housing containing up to 30% secondary aluminum, and the goal is to improve those numbers. BMW is also piloting a project with BASF and the ALBA Group to increase the recycling of plastics used in cars.

As part of what BMW is calling a comprehensive recycling system, “the ALBA Group analyses end-of-life BMW Group vehicles to establish whether a car-to-car reuse of the plastic is possible,” according to a statement by the company. “In a second step, BASF assesses whether chemical recycling of the pre-sorted waste can be used in order to obtain pyrolysis oil. This can then be used as a basis for new products made of plastic. In the future, a new door trim or other components could be manufactured from a used instrument panel, for example.”

To ensure an easier recycling process, BMW is also incorporating early-stage design of vehicles. Materials must be put together in a way that’s easy to disassemble at the end of life and then reuse. The automaker says it will increasingly build the interior of a car with monomaterials that can be transferred back into usable material.

“For example, the onboard wiring systems must be easy to remove, in order to avoid mixing steel with copper from the cable harnesses in the vehicles,” the company said in a statement. “If this mixing does take place, the secondary steel loses its essential material properties and therefore no longer meets the high safety requirements of the automotive industry.”

A circular economy also involves using higher-quality vehicles, which will reduce the overall number of materials used because those parts can be recycled or fixed more easily.

With this announcement, BMW promises transparency when it comes to the life cycle of its vehicles. The company does indeed publish life cycle assessments (LCAs), as does almost every other major car manufacturer, but there’s no standard in the industry yet, which means it’s sometimes difficult to compare different vehicles. Looking at the overall life cycle of a vehicle will be increasingly important if we actually want to cut emissions goals. The emissions that come from the supply chains and manufacturing processes to obtain all the materials needed to even build batteries and vehicles is a body of research that’s only just coming to light, and what that light reveals is the possibility that these moves could even increase emissions in the aggregate.

“Embodied emissions can be devilishly difficult to accurately quantify, and nowhere are there more complexities and uncertainties than with EVs,” writes Mark Mills, a senior fellow at the Manhattan Institute, in a recent TechCrunch article about what it takes to calculate the real carbon cost of EVs. “While an EV self-evidently emits nothing while driving, about 80% of its total lifetime emissions arise from the combination of the embodied energy in fabricating the battery and then in ‘fabricating’ electricity to power the vehicle. The remaining comes from manufacturing the non-fuel parts of the car. That ratio is inverted for a conventional car where about 80% of lifecycle emissions come directly from fuel burned while driving, and the rest comes from the embodied energy to make the car and fabricate gasoline.”

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