Global Automotive Recycling Market Size By Type (Passenger Vehicle Recycling, Commercial Vehicle Recycling), By Material (Metal, Polymer), By End User (New Products Manufacturer, Reusable Parts), By Geographic Scope And Forecast

Automotive Recycling Market Size And Forecast

Automotive Recycling Market size was valued at USD 106.77 Billion in 2023 and is projected to reach USD 184.47 Billion by 2030, growing at a CAGR of 7.19% from 2024 to 2030.

Increasing awareness and sustainability initiatives propelling the market and rising fuel and raw materials prices are the factors driving market growth. The Global Automotive Recycling Market report provides a holistic evaluation of the market. The report offers a comprehensive analysis of key segments, trends, drivers, restraints, competitive landscape, and factors that are playing a substantial role in the market.

What is Automotive Recycling?

Automotive recycling refers to the methodical process of extracting, recovering, and reusing materials and parts from end-of-life vehicles (ELVs). The main objective is to recover valuable elements from abandoned cars, such as rubber, plastics, glass, and metals, to prevent landfills and encourage ecologically friendly disposal methods. Automotive recycling is a multi-step process that starts with the collection and transfer of end-of-life cars and continues with methodical disassembly, de-pollution to eliminate dangerous compounds, material separation through shredding, and finally recovery and repurposing of valuable parts and materials. Automotive recycling is the process of dismantling automobiles and reusing the spare. This fully supports the circular economy being perceived by many governments around the world. According to the World Steel Association AISBL, an average vehicle typically consists of around 65% to 75% of metals (steel and iron).

The recycling process of automobiles involves systematic dismantling, de-pollution, and recovery of materials to ensure environmentally responsible disposal and resource utilization. The first step involves collecting end-of-life vehicles (ELVs) from various sources, including scrapyards, automotive dealerships, and private owners. The vehicles are then transported to the recycling facilities where they undergo systematic dismantling. De-pollution is the next phase where hazardous substances are removed from the vehicle. This includes draining and recycling fluids like oil, coolant, and transmission fluid. When recycling a car, it is important to remove all oils and batteries before sending the car to be shredded. This helps to protect the environment from harmful chemicals and toxins. Post that the vehicle is shredded and sorted using equipment and magnets, air classifiers, and other technologies.

Once sorted, the recovered materials are sent to processing units for further refinement. Metals, including steel and aluminum, undergo melting and purification processes to be reused in manufacturing. Plastics are cleaned, shredded, and melted for use in various applications. Around 30 million of cars are retrieved each year for recycling all around the globe which results in around 14 million tons of recycled steel that allows for the production of 13.5 million new vehicles annually. The recycling of steel from automobiles in North America is estimated to save the equivalent energy necessary to power 18 million homes every year. According to the Edison Electric Institute (EEI), there will be 259 million light-duty vehicles in the USA by 2030, out of which 26.4 million will be electric vehicles.

Global Automotive Recycling Market Overview

Automotive recycling is the dismantling of vehicles for spare parts. At the end of their useful life, vehicles have value as a source of spare parts and this has created a vehicle dismantling industry. Automotive recycling prevents toxic materials from entering the environmentProperly recycling vehicles ensures that hazardous materials, such as lead-acid batteries, mercury switches, and airbags, are safely removed and disposed of, preventing them from entering the environment and potentially harming human and animal health. According to the Extended Production Responsibility (EPR), automobile makers may have to mandatorily use 20% recycled materials out of the total weight of metals they need from 2026-27 onwards.

The driving factors for automotive recycling include the widespread adoption of metal scrap, especially steel, for the manufacturing of more affordable, lightweight, and fuel-efficient vehicles. Automotive recyclers are utilizing advanced tools and methods to recycle used vehicles to extract polymers, fluids, and natural materials that cause minimal damage to the environment. Additionally, rapid growth in industrialization and urbanization in developing nations and increasing consumer awareness drives the Automotive Recycling Market.

Global Automotive Recycling MarketSegmentation Analysis

The Global Automotive Recycling Market is segmented on the Basis of Type, Material, End-Use, and Geography.

Automotive Recycling Market, By Type

• Passenger Vehicle Recycling
• Commercial Vehicle Recycling

To Get a Summarized Market Report By Type-

Based on Type, the Global Automotive Recycling Market is Segmented into Passenger Vehicle Recycling and Commercial Vehicle Recycling. Passenger Vehicle Recycling accounted for the largest market share in 2022. Passenger cars can be recycled for many different purposes. The most common use for recycled passenger cars is for auto parts. Many car parts, including engines, transmissions, alternators, and other mechanical components, can be reused in other vehicles. Additionally, the body of the car can be sold as scrap metal, while the interior can be recycled for upholstery and other materials. This type of recycling helps to keep car parts from ending up in landfills and also saves money for car owners by providing them with a cheaper source of parts.

In India, there are many challenges in the auto recycling industry; one such challenge is the task of an organized recycler to source ELVs. With the dominance of the unorganized sector (as they are located in almost every major hub), for an organized recycler, to get a regular inflow of vehicles is a huge task. It needs to be managed very proactively.

At this time, the used parts industry is very dynamic. On average, brands such as Volvo, Toyota, Audi, and BMW launch new vehicle models every 14 months, which means there is a revision of around 30% of the old models and this revision involves used parts. One of the biggest challenges will be to supply all spare parts from ELVs to the second-hand market because the demand is decreasing with younger models of vehicles on the roads and older vehicles becoming fewer.

The next challenge relates to carbon fiber, and reinforced plastics (CFRP). At the last International Automobile Recycling Congress (IARC), held in Berlin, the focus was on new materials being used in today’s vehicles and how the increased amount of mixed-use plastics may pose challenges to recyclers and dismantlers for ELVs. The increased use of plastic and plastic composite includes carbon fibre, and reinforced plastics (CFRP), and the goal is to make cars lighter and also more fuel-efficient. Though it is good for the industry, in terms of recycling recovery, it reduces the recovery value.

Automotive Recycling Market, By Material

• Metal
• Polymer
• Others

To Get a Summarized Market Report By Material-

Based on Material, the Global Automotive Recycling Market is Segmented into Metal, Polymer, and Others. Metal accounted for the largest market share in 2022. The Automotive Recycling Market consists of two types of metalsferrous and non-ferrous. Ferrous metals contain iron, such as steel, whereas non-ferrous metals do not contain iron, such as aluminum, copper, and zinc. ferrous metals are frequently used in vehicle bodies, chassis, and engine parts, they account for the majority of metals recycled from ELVs. Non-ferrous metals are utilized in lower numbers, but have higher value and demand, as they are employed in electrical and electronic components, such as batteries, wiring, and sensors.

The four essential stages in the automotive recycling sector are dismantling, crushing, shredding, and material recovery. The process of removing reusable and valuable elements from ELVs, such as tires, wheels, seats, stereos, and fluids, is known as dismantling. The practice of compressing ELVs into smaller bits for easier transportation and handling is known as crushing. The process of shredding involves breaking down crushed ELVs into tiny fragments with revolving hammers or blades. Material recovery is the process of removing metal fragments from nonmetallic materials including plastics, rubber, and glass utilizing diverse technologies like magnets, eddy currents, lasers, infrared, and flotation. In addition, the Automotive Recycling Market is expected to grow significantly in the coming years, due to factors such as the increasing number of ELVs, rising consumer awareness, stringent environmental regulations, and scarcity of rare earth metals.

Moreover, according to the American Iron and Steel Institute, Steel and iron play a crucial role in the automotive industry, accounting for around 65% of the average vehicle. Steel and iron in automobiles are recycled at a rate of roughly 90%. Steel cans are the most recycled food and beverage containers in the world, with recycling rates as high as 93% in countries such as South Africa, Japan, and Belgium. Steel-to-steel recycling assures that a steel object, such as a can, can be changed into a variety of goods in its future life, such as bridges, vehicles, or ships. Steel is 100% recyclable without losing its qualities, and due to its magnetic nature, it may even be recovered after incineration. Recycled steel is just as strong and long-lasting as fresh steel made from iron ore. Additionally, reusable parts are removed throughout the recycling process, and the remaining hulks are transferred to ferrous scrap processors.

After being weighed and unloaded, the vehicles are fed into a shredder, which separates them into three streamsiron and steel, nonferrous metal, and fluff (fabric, rubber, glass). The iron and steel are separated and recycled magnetically, contributing to the annual recycling of nearly 14 million tons of steel from scrap automobiles. This recycling effort is comparable to approximately 13.5 million automobiles, resulting in a maintaining 100% recycling rate. The average passenger car is made up of around 65% steel and iron by weight, with car bodywork made up of approximately 25% recycled steel. Recycling programs in the steel sector not only conserve energy and natural resources but also highlight the importance of steel in automobiles, which provides strength, durability, and recyclability.

Automotive Recycling Market, By End-Use

• New Products Manufacturer
• Reusable Parts

Based on End-Use, the Global Automotive Recycling Market is Segmented into New Products Manufacturer and Reusable Parts. New Products Manufacturer accounted for largest market share in 2022. Auto recyclers remove parts such as engines, transmissions, doors, and bumpers for reuse in other vehicles. Other parts that can also be remanufactured include starters, alternators, and water pumps. Batteries, catalytic converters, tires, and some plastics are removed and their materials are recycled into new products. Fluids such as engine oil, coolant, and gasoline are carefully managed to prevent releases by storing them in double-walled tanks and/or secondary containment before being reused or recycled. Once dismantled, the vehicle is sent to a shredding facility. These capital intensive plants are complex material separation operations. The shredder pulverizes the vehicle into fist-sized pieces of materials, which are then sent by conveyors to sophisticated separation technologies, including magnetic separation, eddy current, laser and infrared systems. The metal recovered by these plants becomes raw material feedstock for steel mills, electric arc furnaces, aluminum, and other nonferrous metal smelters to manufacture a variety of products, including new vehicles.

The recycling of automotive materials from cars that have reached the end of their useful life. Metals extracted from automobiles are frequently recycled to produce new steel and aluminum goods that are utilized in a variety of sectors beyond the automotive industry, including manufacturing, infrastructure, and construction. Moreover, Recycled materials, such as nylon from automobile carpets or upholstery fabrics, are made into new textiles that are used in a variety of consumer goods, such as home furnishings, clothes, and accessories. There are several applications for shredding and reusing rubber from tyres. Rubberized asphalt for roads, athletic tracks, playground surfaces, and even shoes are made from recycled tyres. With the rise of electric vehicles, recycling lithium-ion batteries has become crucial. These recycled materials can be repurposed for new batteries or used in energy storage systems.

Automotive Recycling Market, By Geography

• North America
• Europe
• Asia Pacific
• Middle East and Africa
• Latin America

On the basis of Regional Analysis, the Global Automotive Recycling Market is classified into North America, Europe, Asia Pacific, Middle East and Africa, and Latin America. North America is expected to hold the largest market share of Automotive Recycling in the forecast period followed by Europe.

Key Players

The “Global Automotive Recycling Market” study report will provide valuable insight with an emphasis on the global market including some of the major players are Toyota, LKQ Corporation, Sims Limited, Schnitzer Steel Industries, Inc., Scholz Recycling GmbH, Tianqi Automation Engineering Limited, Eco-bat Technologies, Hensel Recycling Group, KEIAISHA CO., LTD, Indra automobile recycling and others.

Our market analysis also entails a section solely dedicated to such major players wherein our analysts provide an insight into the financial statements of all the major players, along with Coating Type benchmarking and SWOT analysis.

Report Scope