Renault and Suez strengthen alliance for sustainable car recycling

In partnership with the waste management group Suez, Renault has announced ambitious plans to make its subsidiary ‘The Future is Neutral’, dedicated to the circular economy, a leading player in Europe. Suez becomes a shareholder in Renault’s branch, which will receive an injection of €140 million to boost its operations and objectives in circularity.

During a press event last week, Renault and Suez revealed that the latter will acquire a 20% stake in The Future is Neutral, with Renault retaining 80%. This partnership will inject fresh capital, worth €140 million, into the subsidiary, accelerating its activities. The two companies’ aim is ambitious: They want to position The Future is Neutral as a reference point for circular economy practices within the automotive sector.

‘Consumers are becoming aware’

Renault CEO Luca de Meo emphasized the circular economy’s growing importance as both a business opportunity and a response to increasing consumer demand for environmentally responsible practices.

“Consumers are becoming more aware of the need to reduce environmental footprints,” he said. The circular economy allows automakers to reduce waste and use raw materials better, extending the life of products and parts.

Annually, 11 million vehicles reach the end of their lifecycle across Europe. And the sector gears up to increase the recycling content and turn it into primary material sources.

In 2022, Renault established its subsidiary, The Future is Neutral, designed to reach beyond the brand boundaries and serve the entire automotive industry. Luca de Meo underscored that The Future is Neutral is an open platform designed to serve the entire automotive industry.

Revenue of €1 billion

Renault’s circularity arm deals with lifespan optimization and batteries already in circulation, offering recycled materials for new vehicle production and circular economy-sourced parts as alternatives to new ones.

These parts are approximately 20% cheaper than new equivalents and utilize up to 80% less raw material, significantly reducing CO2 emissions during the remanufacturing process.

The Future is Neutral recorded revenue of €1 billion last year, and its goal is to double this figure by 2030. Stellantis aims for precisely the same turnover from its Sustainera department, inaugurated in Turin in November 2023, by the decade’s end.

Circular economy as a business opportunity

Suez CEO Sabrina Soussan noted that securing secondary raw materials would be a critical issue for the automotive sector in the coming years. “Reducing dependence on virgin raw materials is essential,” Soussan added, citing the volatility of raw material prices, such as lithium, and the geopolitical challenges in sourcing certain metals.

The newly formed venture will help streamline the supply of recycled materials. The circular economy in automotive is increasingly seen as a business imperative. European regulations require that 95% of a vehicle’s mass be recycled by 2031. The European market for automotive recycling is valued at €14 billion.

Long-standing relationship

Renault and Suez have a long-standing relationship, dating back to 2008, when they first partnered on metal recycling and end-of-life vehicle recovery. With The Future is Neutral, they are taking this collaboration to new heights.

Their joint ventures include the French company Indra, which processes end-of-life vehicles, and other subsidiaries focusing on battery recycling and remanufacturing automotive parts.

Renault operates three ‘renew factories’ focused on reconditioning vehicles. Located in Flins (France), Seville (Spain), and Bursa (Turkey), these facilities have reconditioned over 50,000 used cars since 2021.