Tuesday, October 7, 2014

Reduce, Reuse, Recycle: Remanufacturing and the Circular Economy

New technologies, increased producer demand and increased natural resource prices have led to a new phenomenon in the manufacturing world. Remanufacturing, at a point in near history unnecessary, is growing and is projected to become the connecting factor in what once was considered a linear economic manufacturing process.
Remanufacturing is, in the easiest sense, recycling. With so many products being made every day around the world, and our consumption of nearly all products rising (with a growing international middle class) there is potential to reuse disassembled material that may have previously been discarded. The consumer, or the trash bin, do not have to be the final resting place of these products. What if our toasters, cars and clothes, after we had tired of them, went to a specialized facility, where they were deconstructed and reused for new products? With a growing concern for recycling and reusing, companies have a unique and economically viable option to continue the manufacturing process past the end-of-line consumer.
This economic process is dubbed “The Circular Economy,” as there can be no set end point in production or consumption.  In the article “4 Ways the Networked Economy is Circular,” three key principles enable the circular economy to succeed. 1) There is a distinct difference between biological and technical products. Technical products can be reused, while biological products decompose in the environment; 2) Products most be designed for waste-reduction in disassembly – allowing for ease of reuse and cost-effectiveness; and 3) Energy used to fuel this re-manufacturing should be renewable, to reduce energy supply dependence and risk.
At its core, remanufacturing and the circular economy are about reducing waste, which we have spent a significant portion of our time talking about. The largest issue surrounding the process of remanufacturing is the reliability of lowered prices to remanufacture products, though with the increased costs of fuel, the idea that a car manufacturer would already have the steel necessary to build a new frame from old cars would cut out a large portion of their initial investment into production.
Using Renault’s plant in Choisy-le-Roi as an example, the plant that remanufactures engines, transmission, injection pumps for resale actually se 80% less energy and nearly 90% less water than new production of those components. Renault, as based on the principles outlined above, actually designs these pieces to be easier to disassemble and reuse – also forming partnerships with recyclers and waste management companies to assist with end-of-use product design. Renault’s model and partnerships have actually influenced these partner companies to design new products to be used in the process, further reducing waste and cost.
            As remanufacturing and the circular economy have not fully integrated into the manufacturing process for most companies, it will be interesting to see what the future holds in regards to its adoption. Will companies see overall loss in investment? Their shareholders fearing that with reused products come lower prices and less need? With the growing world of the maker-manufacturer, are smaller scale versions of remanufacturing shops going to take over the market, rather than relying on enormous companies to expand their economic outlook towards reuse rather than a linear path? No matter what the path, the companies investing in the process from the beginning are seeing reduced cost and waste, good signs of an up-and-coming process.

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