So what’s different between the life cycle of the newly manufactured transmission and the remanufactured one? The new transmission is made entirely from new raw materials, and follows the dominant economic model of our day, a linear economy. Products are made with raw materials, they are consumed, and many end up as waste once they are discarded. Some products and materials are widely recycled and returned back to the early stages of manufacturing. However, recycling used components means much of the energy and value they embody is lost. In contrast, the remanufactured transmission follows a circular-economy model that looks to design reuse into an economy while phasing waste out of it. This means that end-of-life products and components are brought back into the economy as inputs to the remanufacturing process to produce newly remanufactured products. While a remanufactured transmission will likely contain some new parts and cannot be reprocessed indefinitely, it significantly reduces the need for fresh natural resources and the amount of waste that is generated.
The transmission example above shows remanufacturing in practice. Below are the key steps that make it an effective industrial process.
- core collection and logistics
- core assessment and sorting
- assembly and testing
Remanufacturing as decoupled manufacturing
As we saw in the example above, conventional, linear manufacturing begins when raw materials are extracted from the earth. Then they are processed, transported, and used to produce commodities that are purchased and consumed. Eventually those products are discarded or thrown away at the end of their useful life (if not earlier).
A 2008 life-cycle assessment (LCA) study conducted by the Center for Sustainable Systems at the University of Michigan found that remanufacturing a mid-sized gas-powered car engine in the United States requires 68-83% less energy and produces 73-87% less carbon dioxide than one made new by an OEM. The researchers also found that, in some cases, it required as much as 90% less raw materials than a new engine would require.
Every manufactured product or component has embodied value, even when it doesn’t seem useful anymore to a customer. All the energy expended during the extraction of raw materials, production, and transport of goods are embodied in the post-consumer commodity, not to mention all the materials and labor spent to make it. Remanufacturing approaches products and components at the end of their lives not as waste, but as an opportunity for recovering valuable resources. It’s a practical method for returning that value back to the economy. But remanufacturing doesn’t only open opportunity for businesses, it points to a viable path for economic growth that is decoupled from environmental impact.
Consider these statistics:
Remanufacturing in practice today
Remanufacturing is a child of necessity. It first emerged in the United States during the Second World War as a resource-efficient way to produce and maintain heavy machinery during the war effort. Since that time, the industry has evolved and been adapted to serve 12 key industrial sectors:
- consumer products
- electrical apparatus
- office furniture
- heavy-duty and construction equipment
- information technology
- locomotive systems
- medical equipment
- restaurant equipment
- imaging products and consumables
Thanks to remanufacturing, industrial sectors that rely on high-value assets like these are able to dramatically extend the useful life of their vehicles, machinery, other heavy-duty equipment, and even some electronic components. This translates into significant cost savings for businesses as well as for everyday consumers. For example, a remanufactured car engine, which performs as well as or better than a new one, can cost 30-53% less than installing a completely new engine.
The future of remanufacturing
The output of remanufacturing in the U.S. is worth $75 billion, providing 180,000 full-time jobs. American companies exported over $11.7 billion worth of remanufactured goods in 2016 alone. The United Kingdom and the European Union also boast robust remanufacturing sectors, with British remanufacturers’ production valued at about $8 billion per year. Japanese remanufacturers produce $4.8 billion worth of goods annually.
Strong as the existing remanufacturing industry is, it has plenty of room to grow. It accounts for only 2% of all manufacturing in the U.S. and just 1.9% in the European Union. Such a small market capture reflects the sheer complexity of the industry, but as policymakers and investors alike seek sustainable manufacturing methods to advance what’s known as the circular economy, they are increasingly turning to remanufacturing. In doing so, advances within remanufacturing are happening like never before in its 80-year history. Governments, corporations, and researchers are working together to address critical challenges that have long limited remanufacturing’s wider adoption. These efforts are occurring in the following key areas:
Industry and trade policies
Policies are an effective strategy for not only growing a country’s remanufacturing sector, but creating one. This is what China first set into motion in 1999 when it launched an elementary program to establish a remanufacturing sector within its emerging industrial economy. The government issued the Circular Economy Promotion Law and published “Recommendations on Promoting Remanufacturing Industry” over the course of the following decade. By 2014, its remanufacturing strategy entered its implementation phase, following the release of two important policies: “Swap the Old for Remanufacturing” and “Pilot Remanufacturing Enterprises.”
The global economy means that a single product often crosses many borders over the course of its life. When remanufacturers “harvest” cores, they work with brokers and dealers operating around the world. One of the biggest challenges they face are trade policies that, often inadvertently, impede the movement of cores from one country to another. Typically, this comes down to a lack of consistent terminology for post-consumer industrial components that either can be remanufactured or have been remanufactured.
Education and outreach efforts
In 2018, the United Nations International Resource Panel (UN IRP) published a report to provide policymakers, business leaders, and consumers with a working definition of remanufacturing. It addressed long-standing confusion around what remanufacturing is and how it is unique from other resource-recovery methods like recycling, refurbishment, reuse, or repair. The report introduces a new concept to describe all such techniques for extending the life or extracting more value from post-consumer products and components: value-retention processes (VRPs). Each VRP—remanufacturing, refurbishment, repair, recycling, and direct reuse—reduces, to a varying degree, the following:
- overall product cost
- the use of raw materials
- total energy consumption (process and embodied)
- greenhouse-gas emissions
- waste generation
Remanufacturing remains the most efficient of all VRPs when it comes to capturing the embedded value of the cumulative labor, energy, and manufacturing costs already invested into a product. Understanding remanufacturing as a VRP helps to highlight what’s unique about remanufacturing as an industrial process and how it can work with other methods to decouple industry from environmental degradation.
The extent to which a component or product can be remanufactured is determined largely by how it is designed. Yet most commodities on the market are not originally manufactured with remanufacturing—or any other end-of-life recovery pathway—in mind. This leads to a variety of products that have little to no value by the end of their first use cycle, making remanufacturing unfeasible. For those items where it is feasible, remanufacturers often have to work backwards, adjusting their processes to accommodate varying designs and specifications. Design for remanufacturing (DfR) is a concept that was developed to overcome this common barrier for not only remanufacturers, but any circular-economy intervention. Industry associations like the Remanufacturing Industries Council (RIC) work to promote DfR practices through education and outreach, lobbying, and technological research.
Advanced technology for remanufacturing
Most traditional manufacturers have had to completely rethink their processes as a revolution in digital technology reshapes the entire landscape of production—but not remanufacturers. They are already ahead of the curve when it comes to unlocking new potential through advanced technologies. New applications of digital technology and artificial intelligence (AI), like machine learning and the Internet of Things (IoT), are allowing remanufacturers to work faster and more effectively than ever before, which, in turn, makes the industry more competitive.
Take condition assessment, one of the most challenging and time-consuming steps in the remanufacturing process. A remanufacturer can now use IoT technologies like embedded micro-electronics and sensors to quickly assess the health of a component while in use and to determine whether it is in need of repair. Real-time data can be tethered to key components of a post-consumer product to streamline the identification and sorting of parts, fast-tracking the in-take of cores.
Condition assessment is just one aspect of remanufacturing that will benefit from new advances in technology. Read this article for a deeper dive into how disruptive digital technologies are helping to grow the remanufacturing industry.
Between 2009 and 2011, the remanufacturing industry in the U.S. grew by 15%. Much of that growth was due to focused collaborative initiatives between industry leaders, government agencies, and research-driven organizations. Rochester Institute of Technology (RIT) was an early trailblazer of such collaborations, establishing the Center for Integrated Manufacturing Studies (CIMS) in 1992 and the Center for Remanufacturing and Resource Recovery (C3R) in 1996. In 2007, RIT founded the Golisano Institute for Sustainability (GIS) to further build productive partnerships between policymakers, researchers, and businesses to drive sustainability within the industrial system. GIS launched the RIT Remanufacturing Testbed in 2019, the only resource of its kind in the U.S. where companies can research, develop, and validate remanufacturing and resource-recovery technologies and processes.
Among the most ambitious collaborative efforts for advancing American remanufacturing is the REMADE (Reducing EMbodied-Energy And Decreasing Emissions) Institute, which was created by the U.S. Department of Energy in 2017. It is a research-and-development (R&D) consortium designed to support U.S. manufacturers in the development and deployment of technologies that will advance sustainable production methods like remanufacturing. REMADE represents the largest recycling and remanufacturing research program in the U.S., with over $140M in committed funding by government agencies, industry partners, and research universities. Companies join as members, co-sponsoring applied research with the federal government to drive promising manufacturing technologies and processes that enable greater material efficiency and capture more value from end-of-life products.