Select Committee on Trade and Industry Appendices to the Minutes of Evidence


Memorandum by the BMW Group


  BMW shares the European Union's concern for the environment and welcomes the opportunity to be involved in discussions to decide the most effective way of implementing the EC Directive on End of Life Vehicles. We fully support the Directive's aim to minimise the environmental impact of the motor car over the whole of its lifetime. An important aspect of this is the way in which we handle motor cars at the end of their useful life.

  In 1990 BMW set up a Recycling Development Centre (RDC) on the outskirts of Munich dedicated to research and development of all aspects of effective motorcar recycling. The RDC works with Design and Engineering Departments to ensure that this research produces results that can be used in a very practical and cost effective way in the construction of the motorcar. The research carried out does not end with design and development of the motorcar for recycling but also includes dismantling methods and techniques. The RDC has a fully operational dismantling and recycling facility where dismantling techniques and equipment are developed and staff of recycling companies collaborating with BMW Group are trained.

  In 1991 BMW began to establish a nationwide recycling and dismantling network. It is the policy of BMW Group to ensure recycling is carried out in an environmentally friendly manner. This is achieved by approving recycling companies that meet our standards. BMW initiated a co-operative with Fiat, Renault and Rover, in 1994 called "Together for Recycling". The signatories share Take Back and Recycling Networks in a large number of EC member states and common material cycles are established and used jointly. For these brands a recycling network is already in place for the main European markets.

  Membership of the VDA/Pravda has deeply involved BMW in the evaluation of recycling methods and the development of new recycling technologies. BMW Group has also been a CARE member for many years and contributes to the success of this working group.

  BMW has already been involved with implementing the directive in other EC member states and has followed closely the European wide discussions that have taken place on the subject. With this extensive knowledge we are pleased to contribute to discussions to assist with the smooth and effective implementation of the directive in the UK.

  In our experience for an ELV recycling system to be efficient it is important to take an integrated view of the technical, legal and economical factors. In this light, following observations are offered.

  1.  The ELV Directive requires that collection facilities are "adequately available". Whilst no figure is suggested to satisfy this requirement our experience in Germany and the Netherlands is that vehicle producers and the dismantling/shredding industry do work together to develop full availability without the need for external intervention or regulation.

  2.  An effective Certificate of Destruction linked to vehicle licensing and deregistration is required to ensure correct processing of ELV's by approved operators. This document should be easy to administer and have safeguards against falsification. The certificate should also be issued at a stage when the ELV is beyond further use and certainly not before the de-pollution process.

  3.  The heavy metal ban of the ELV directive should not be used as criterion for type approval of cars because hazardous materials are already well regulated by existing directives. An additional approach using type approval gives no benefit but would generate additional administrative burdens. Annex II, which allows the use of heavy metals in specific applications, would be very difficult to apply as a reliable base for type approval due to the exceptions being subject to constant review and change. The Commission will restructure their chemical policy within the 6th Environment Action Programme of the European Community 2001-2010. Metals alloys and their compounds will be included and different laws will be harmonised which will effect the use of metals. It is expected that this will apply to the materials ban of the ELV directive. If the material ban is to be included in type approval we would suggest that to avoid continual changes to type approval it is not considered until after restructuring of the chemical policy is complete.

  4.  Free take back of ELVs should not be implemented any sooner than the dates set out in the directive. Responsibility for all new cars should commence in 2002 but if implementation of free take back of all cars is sooner than 2007 it is unlikely that all the parties involved will be in a position to accept their responsibilities. A substantial increase of the financial burden for the entire automotive industry would result and there would be a significant variation in the market conditions within the EU since most member states have already endorsed the 1.1.2007 implementation date.

  5.  To ensure that an economically viable recycling process can be established it is essential that Producers should only be responsible for the free take back of ELVs if the car is complete and does not contain waste.

  6.  The EU directive refers to material identification and part labelling to facilitate recycling. This is an important factor and the German experience has proven that this can be handled on a voluntary basis. It is also in the manufacturers interest to facilitate recycling to achieve recycling targets therefore further regulation is not required. BMW Group marks each plastic component based on a VDA recommendation since the year 1991.

  7.  A survey of existing financing systems for ELV recycling clearly indicate that an enforced fund cannot be run effectively. The use of public funds can lead to high additional administration cost and reduces any incentive to develop ecological, economic and efficient material cycles. In fact any system that introduces a third party to control funds will add to the costs. Fund or collective systems may also restrict fair competition between the economic operators involved. BMW Group considers the free take back as a kind of warranty that is offered to the last owner of an ELV.

  8.  We would suggest that a market driven approach with private contracts between vehicle manufacturers and recycling companies ensures fair competition and an incentive for the recycling businesses to improve their processes. But competition among the recycling industry must be based on common operating standards that each recycling company must fulfil. To ensure these common standards are observed by the recycling business an independent control by a third party (government body) is necessary.

  9.  The standards set for the recycling industry (such as demands for draining facilities, or dismantling requirements) will influence ELV recycling costs. This needs to be considered when looking at the economics of the recycling process.

  10.  The EU directive determines that vehicle manufacturers "will have to accept all or a significant part of the cost of free ELV take back". Any sharing of these costs with other economic operators that benefit from the life of the car should only be considered if this does not lead to administrative costs or unfair competition that outweighs the benefit.

  11.  The effectiveness of the recycling system is very much based on the principle that only those cars can be delivered into the system by the last owner will be accepted for free take back. All other cars including illegal abandoned cars are outside the manufacturers responsibility but can cause a significant environmental and financial risk. To ensure a controlled ELV recycling process the last owner must have the legal obligation to hand over his ELV to an appropriate recycling facility or take back point. This can be facilitated by the effectiveness of the deregistration system.

  12.  It is important that the recycling rate demands are defined in a way that is as easy as possible to monitor with a minimum of administration. Our experience is that this can be achieved when the recycling rate demands form a part of the legal requirements for dismantlers and shredders. These demands can easily be monitored within the audit of the standards for compliance with Annex 1.

  13.  The European waste catalogue classifies ELVs that have not been drained as hazardous waste. This could cause significant additional transportation costs due to the monitoring effort required for these waste categories. Therefore some member states have or will exclude ELVs from the monitoring requirements of hazardous waste during transport. We suggest that consideration is given to this matter in the UK.

The DTI Consultation Paper

  Based on the BMW experience in other European markets it is not envisaged that Options two or three as outlined in the DTI consultation paper provide a suitable solution to ELV Directive implementation in the UK. However, it can be demonstrated from practical experience that Option 1 with some modifications can be adapted to be a workable solution which would satisfy the requirements of a number of UK car manufacturers.

  Alternative options to those suggested in the consultation paper should also be considered. In particular a process similar to that being implemented by the French government would be worth further investigation, as outlined in the SMMT response.

  We would be happy to discuss these points in more detail and feel confident that a satisfactory option for implementation of the Directive to fulfil the environmental improvements it seeks to achieve can be found.

  Our RDC facilities and experience with implementation of the Directive in other member states are available to assist with determining the best option for implementation in the UK.

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