Volvo Cars to Reduce Annual Carbon Emissions by 2.5 Million Tons... Introducing Circular Business Model

Power Supply Using Volvo's Electric Vehicle Batteries

Photo by Volvo Korea

[Asia Economy Reporter Ki-min Lee] Volvo Cars announced on the 3rd that it will introduce a circular business model starting in 2025, aiming to reduce annual costs by 132 billion KRW and carbon emissions by 2.5 million tons.

Additionally, to achieve the goal of transitioning to a circular business by 2040, the company plans to establish a closed-loop system to reuse and refurbish materials with high exhaust emissions such as steel and aluminum.

This is intended to maximize the value within the product life cycle for as long as possible, optimizing the use of materials, parts, and vehicles, and eliminating waste in the process. Volvo Cars explained that the circular business model not only leads to financial savings and new revenue streams but also significantly reduces environmental impact.

Volvo Cars has already begun remanufacturing gearbox and engine parts. Last year, it remanufactured 40,000 parts, reducing approximately 3,000 tons of carbon dioxide (CO2) emissions. Furthermore, to ensure valuable materials are circulated again, about 95% of last year’s production waste, including 176,000 tons of steel, was recycled. In terms of figures, this prevented about 640,000 tons of CO2 emissions.

Moreover, research is underway on battery recycling, such as reusing high-voltage batteries for electric vehicles as energy storage systems (ESS). To this end, Volvo is collaborating with BatteryLoop, a subsidiary of Sweden’s Stena Recycling Group, to use batteries from electric vehicles in solar ESS applications.

Anders Kalberg, Head of Global Sustainability at Volvo Cars, said, "Volvo Cars has the most ambitious climate plan in the automotive industry, and embracing the circular economy is essential to achieving these goals. For this, we must rethink everything we have done and our approaches so far."

This content was produced with the assistance of AI translation services.