Who will be impacted by digital product passports: Automotive industry?
In March 2020, the European Commission put forward its Circular Economy Action Plan, aimed at improving sustainability and reducing waste across various industries, including the automotive sector.
European Automobile Manufacturers' Association data shows that while overall waste from automotive manufacturing has fallen 2.2% since 2005, the total waste generated per unit has actually risen by 32% over the last 17 years.
With the industry being such a significant contributor to environmental pollution, one of the key initiatives in the action plan is the introduction of Digital Product Passports (DPPs).
DPPs are set to revolutionize the automotive industry by enhancing the transparency and sustainability of the entire supply chain. DPPs will provide stakeholders at every level with information about the life cycle, carbon footprint, and recyclability of vehicles and components.
DPPs will have a large impact on all levels of the automotive supply chain, from critical raw materials suppliers to end users. Here are a few ways the changes will impact the industry:
- Automotive OEMs and EV battery manufacturers will need to provide detailed information on the materials used in their vehicles and components. This will include data on manufacturing processes and environmental impact.
- Suppliers of critical raw materials will need to disclose transparent information about the sourcing practices and sustainability of their products.
- Automotive dealers will need to ensure that customers have easy access to information held in DPPs to allow for more sustainable choices.
- DPPs will provide customers with better information on repairability and recyclability.
- Waste management and recycling companies will have access to more detailed information on the materials and components in end-of-life vehicles.
Digital Product Passport: automotive timeline
The European Union's (EU) regulations for Digital Product Passport (DPP) will come into effect between 2026-2027. The first affected products will be batteries in 2026 which will impact EV batteries. DPPs for the wider automotive industry will be introduced shortly after.
How to prepare for digital product passports in the automotive industry:
Companies in the automotive sector should start taking steps now to get ahead of DPP regulations and maintain compliance. These steps include:
- Gathering accurate data on all materials and manufacturing processes used in the supply chain to evaluate the environmental impact of vehicle components.
- Developing a compliance strategy and designating a DPP lead.
- Auditing suppliers to ensure they can provide all the necessary data for when DPPs become mandatory.
- Implementing a reliable DPP technology solution to manage and store data efficiently.
What to look out for in a DPP solution for automotive?
With how complex supply chains are in the modern automotive industry, companies need to look for a DPP solution that can handle data from every stakeholder in the supply chain.
This is especially true for companies involved with electronic vehicles, as assessing ethicality and tracing the origin of critical raw materials in battery manufacture is notoriously difficult.
AuthentifyIt is built to meet these needs as a comprehensive all-in-one DPP solution that ensures compliance through user-friendly software and expert regulatory consultancy.
Get in touch with us today for a discovery call and see how AuthentifyIt can help you get ready for the future.
