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June 12, 2000 02:00 AM

Recycling Europe's cars to cost suppliers

Richard Higgs PLASTICS NEWS CORRESPONDENT
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    A European Union regulation that will force the automotive industry to bear the cost of recovering and recycling all the region's scrapped vehicles cleared its final hurdle recently and is set to become law in late June. Auto parts suppliers, including plastic processors, can expect automakers to push some of the financial burden onto them, according to a leading European automotive supplier official.

    Some plastics industry officials argue that the regulation — known as the end-of-life vehicles directive — sets unrealistic and even contradictory environmental goals. The topic commanded much of the discussion during a May 18 automotive industry workshop held in Brussels, Belgium, as part of Plastics Forum 2000, organized by the European Plastics Converters.

    Despite a rear-guard action by some members of the European Parliament who want to limit how much car manufacturers will pay toward the recovery costs, the Parliament and Council of Ministers of the 15 EU member states finally agreed in late May to give the ELV directive the green light.

    With 170 million cars on the roads of Europe, the implications for the automotive industry are formidable. The cost of scrapping those vehicles is estimated at 25 billion euros ($23.6 billion).

    Currently, scrapped vehicles in the EU region account for about 20 million pounds of waste a year. Estimates suggest that about 75 percent of a vehicle's weight, mainly metal, is recovered, while the rest goes to landfills.

    Plastics accounted for 9.3 percent of the material used in European car production in 1998, according to data from the Brussels- based Association of Plastics Manufacturers in Europe. Plastics' share is expected to rise to 15 percent by 2005.

    Under the new directive, carmakers are obliged to meet all or "a significant part" of the disposal cost for all new vehicles put on the market in Europe from January 2001, and for all older vehicles by January 2007.

    In addition, the regulation demands the auto industry reuse or recycle at least 80 percent of vehicles' weight by January 2006. That goal will rise to 85 percent by 2015.

    The motor industry, which has begun to build recyclability into the designs of many of its newer models, agrees the cost of recycling should not fall on the final owner of a vehicle.

    However, automakers argue that the cost should be shared among car manufacturers, national governments and the scrap industry.

    Manufacturers are widely expected to transfer the huge new costs imposed by the legislation to the consumer by hiking new-car prices.

    But Europe's plastic auto-parts makers and other suppliers also can expect to feel the backwash effects of the new EU law, according to Claude Thibaut de Maisieres, chairman of the automotive strategy committee of European Plastics Converters. He spoke in a telephone interview.

    "The automotive industry will certainly transfer those costs to the suppliers. The industry has a long history of passing on its costs to its suppliers," said Thibaut de Maisieres, a director of Solvay SA's processing division in Brussels. Solvay is one of the world's largest blow molders of automotive fuel tanks.

    He complained that the new directive is contradictory and unworkable.

    Very few plastics components in vehicles can be recycled and reused, and there are few outlets for recycled plastic auto parts, he said.

    "The quotas are much too high," said Thibaut de Maisieres.

    He added that the recycling quotas contradict other environmental initiatives in Europe, including efforts to build more fuel-efficient cars through the use of lighter materials such as plastics.

    "This directive is totally unreasonable and will collide head-on with other regulations on the reduction of carbon dioxide emissions [from vehicles]," he said.

    Thibaut de Maisieres pointed out that the EU is committed to reviewing the regulation and the recycling targets by 2005.

    "Hopefully, reason will prevail over emotion and environmental feelings on this directive," he said.

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