Circular economy in the automotive industry: Strategic recycling partnership

BMW Group and PreZero, an international circular economy company within the Schwarz Group, have signed a strategic cooperation agreement at the Innovation Park Artificial Intelligence (IPAI) in Heilbronn, Germany. The initiative aims to develop an industrial model for recycling end-of-life vehicles and creating closed-loop material cycles to strengthen resilient supply chains.

Context of the cooperation and industrial objectives
Increasing regulatory pressure and the need to reduce the use of primary raw materials are accelerating the adoption of circular economy models in the automotive sector. The collaboration between BMW Group and PreZero seeks to leverage the strategic potential of advanced recycling by systematically transforming end-of-life vehicles into a structured source of reusable and recyclable materials.

The long-term objective is to reduce dependence on virgin resources and improve supply chain stability through a holistic approach to material management.

Technical solution and operational model
The project involves developing a business model based on multiple operational phases. Initially, vehicle components will be kept in circulation as long as possible through reuse and remanufacturing strategies. Subsequently, advanced recycling processes will enable the recovery of high-quality secondary materials, including steel, aluminum, plastics, and battery raw materials.

The cooperation integrates complementary expertise: BMW Group contributes know-how in “design for recycling,” circular-oriented product development, and experience from its Recycling and Dismantling Centre (RDC). PreZero provides expertise in material flows, sorting technologies, and industrial recycling, including extensive experience in battery recycling.

Knowledge transfer and industrial development
A key element of the partnership is knowledge transfer across the entire value chain—from vehicle development and production to dismantling and material recovery. The aim is to industrialize innovative recycling processes and develop new approaches to material flow management, fostering closer integration between vehicle development and recycling operations.

Strategic impact and regulatory alignment
The cooperation represents a core pillar of BMW Group’s decarbonization strategy and reinforces circular economy principles as a sustainable business model for the automotive sector. The initiative is also aligned with European circular economy policies and efforts to strengthen industrial resilience.

By developing scalable and standardized solutions, the partnership aims to improve resource efficiency, reduce material-related emissions, and accelerate the transition toward more sustainable production systems.

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