Memorandum by the BMW Group
THE ECONOMIC IMPACT OF THE END-OF-LIFE VEHICLE
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
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
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
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
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
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.