BMW Neue Klasse: Circular Economy & CO2 Emission Reduction

BMW Group's Commitment to Carbon Reduction

The BMW Group declared on Thursday its intention to achieve a 50% decrease in global carbon dioxide emissions originating from the use of its vehicles by 2030, relative to 2019 levels. Furthermore, a 40% reduction in emissions throughout the entire vehicle life cycle is targeted. These objectives, alongside a focus on circular economy principles for a more sustainable vehicle lifespan, will be realized through the company’s Neue Klasse platform, anticipated to launch by 2025.

Introducing the Neue Klasse

The BMW “New Class,” unveiled in March, represents a revitalization of a sedan and coupe series produced by the German automaker between 1962 and 1977. This original line was instrumental in establishing BMW’s reputation as a manufacturer of sports cars. The new iteration will incorporate a “completely redefined IT and software architecture, a next-generation of high-performance electric drivetrains and batteries, and a fundamentally new approach to sustainability across the complete vehicle life cycle,” as stated by the company.

Leadership Statement on Emissions Goals

“With Neue Klasse, we are markedly reinforcing our dedication and charting a definitive course toward achieving the 1.5-degree target,” explained Oliver Zipse, Chairman of the Board of Management of BMW AG. “The manner in which companies address CO2 emissions is increasingly central to evaluating corporate performance. The most significant aspect of combating global warming lies in our ability to enhance the carbon footprint of vehicles throughout their entire operational life. Consequently, we are establishing transparent and ambitious goals for substantial CO2 emission reductions, validated by the Science Based Targets Initiative, which will contribute effectively and measurably.”

The Impact of Vehicle Usage on CO2 Footprint

BMW indicates that the utilization phase of its vehicles contributes to 70% of the group’s overall CO2 footprint. This is largely due to the fact that the majority of BMW’s current sales still consist of internal combustion engine (ICE) vehicles. In the first half of 2021, approximately 11.44% of BMW’s total sales volume comprised electric or plug-in hybrid models, as reported in its 2021 half-year earnings. The company aims to sell 1 million plug-in units, including hybrids, by the end of 2021.

Currently, around 850,000 units have been sold as of Q2. To achieve its goal of halving emissions during vehicle operation, BMW must significantly increase its sales of low or zero-emission vehicles. The automaker has already released the i3 compact EV and plans to introduce the i4 sedan and iX SUV, both long-range models, later this year, with further launches planned for 2022.

However, unlike GM or Volvo, BMW has not announced plans to discontinue ICE vehicle production, nor has it begun offering a complete range of vehicles designed exclusively for battery operation.

Past Emissions Violations and EU Regulations

This announcement follows a recent acknowledgement by BMW, alongside other German automakers like Volkswagen, Audi, and Porsche, of their involvement in an emissions cartel dating back to the 1990s. These companies collectively concealed technologies capable of reducing harmful emissions beyond the levels mandated by EU standards. The EU imposed a $442 million fine on BMW, a relatively small penalty considering the company’s second-quarter profits of nearly $6 billion.

The EU’s “Fit for 55” Package and Future Regulations

Furthermore, the EU’s “Fit for 55” energy and climate package, released last month, increased the overall carbon emissions reduction target from 40% to 55% by 2030. This necessitates a faster pace of electrification for automakers, a reality BMW acknowledges. Discussions within the European Commission reportedly include a 60% emissions reduction by 2030, followed by a 100% reduction by 2035, potentially making the sale of ICE vehicles nearly impossible by that time.

Neue Klasse and BMW’s Electrification Strategy

BMW asserts that the Neue Klasse will accelerate the introduction of EVs to the market. The automaker intends to have 10 million all-electric cars on the road within the next decade, with at least half of all BMW Group sales being all-electric. The Mini brand is slated to become exclusively all-electric by 2030. As part of its circular economy initiative, BMW also plans to increase the utilization of secondary materials and establish a robust market for these materials with the Neue Klasse.

The company aims to raise the proportion of secondary materials used from its current 30% to 50%, although a specific timeframe for this increase has not been provided.

Utilizing Secondary Materials in Vehicle Production

BMW highlights its current use of secondary nickel in the iX battery, already at 50%, and the battery housing containing up to 30% secondary aluminum. The goal is to further improve these figures. BMW is also conducting a pilot project with BASF and the ALBA Group to enhance the recycling of plastics used in vehicles.

A Comprehensive Recycling System

According to a company statement, “the ALBA Group analyzes end-of-life BMW Group vehicles to determine the feasibility of car-to-car reuse of plastic components.” Subsequently, BASF assesses the potential for chemical recycling of the pre-sorted waste to produce pyrolysis oil, which can then serve as a basis for new plastic products. “In the future, a new door trim or other components could be manufactured from a used instrument panel, for example.”

Design for Disassembly and Monomaterial Construction

To facilitate easier recycling, BMW is incorporating design considerations into its vehicles from the outset. Materials are being assembled in a manner that allows for straightforward disassembly and reuse at the end of the vehicle’s life. The automaker intends to increasingly construct vehicle interiors using monomaterials that can be effectively recycled.

“For example, the onboard wiring systems must be easily removable, to prevent the mixing of steel with copper from the cable harnesses in the vehicles,” the company explained. “If this mixing occurs, the secondary steel loses its essential material properties and therefore no longer meets the high safety requirements of the automotive industry.”

The Benefits of Higher-Quality Vehicles

A circular economy also benefits from the use of higher-quality vehicles, which reduces the overall amount of materials needed due to the increased recyclability and repairability of components.

Transparency and the Challenges of Life Cycle Assessments

With this announcement, BMW pledges transparency regarding the life cycle of its vehicles. The company, like most major automakers, publishes life cycle assessments (LCAs). However, a lack of industry standardization makes comparing different vehicles challenging. Evaluating the complete life cycle of a vehicle is becoming increasingly crucial for achieving emissions reduction targets.

The emissions associated with supply chains and manufacturing processes – including the materials required for battery and vehicle construction – are areas of emerging research. Initial findings suggest that these processes could potentially increase overall emissions.

The Complexities of EV Emissions Calculations

“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. “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.”