In 2023, the European Commission released a proposal for a new End of Life Vehicle Regulation (ELVR). The proposal builds on and aims at replacing two existing Directives: Directive 2000/53/EC on end-of-life vehicles and Directive 2005/64/EC on the type-approval of motor vehicles with regard to their reusability, recyclability and recoverability. The ELVR proposal is discussed by the European Parliament and Member States in 2025 and should be finalised early 2026.
While there is great potential to increase the use of recycled steel in new cars, the European Commission (EC) did not propose any binding targets. Instead, they have only committed to conducting a feasibility study. In its European Steel and Metals Action Plan launched on March 19, the EC proposed to conduct the feasibility study until “the end of 2026”.
To assess how to increase scrap-based steel use in the automotive industry under the proposed ELV regulation, T&E commissioned Oeko-Institut to conduct a dedicated feasibility study on steel recycled targets. Oeko-Institut was chosen as they had already carried out a study to support the impact assessment for the review of Directive 2000/53/EC on end-of-life vehicles in 2023. This briefing outlines the key findings from the study. It shows that setting steel recycled content targets (30% in 2030 and 40% in 2035) and recycled steel quality requirements are technically and economically feasible.
These targets should therefore be included by co-legislators as part of the ELVR co-decision process.
European carmakers rely heavily on high-emission coal-based primary steel
Current use of scrap-based steel in the automotive industry is low. The study shows that as of today there is only a small proportion of secondary steel from post-consumer scrap in new vehicles (11.3% in ICEs, 5.3 % in EVs) in the EU. Overall we calculate that just 6% of current total scrap steel production in the EU goes into new cars.
Steel used by major European automakers is estimated to have an emissions intensity equal to or above 2 tonnes CO2e per tonne of steel, which is more than double the EU steel industry average (combining both primary & secondary routes).
Copper contamination of steel scrap is a challenge, but can be solved with dismantling and processing
The high copper contamination of scrap-based steel is the main obstacle for the uptake of secondary steel in the automotive sector. The automotive industry demands high-quality steel with a maximum copper content of 0.1% especially for flat steel components, some parts even require 0.06% (e.g. body-in-white components, such as doors, hoods, roofs) to meet strength and safety standards.
According to Steelonthenet, on average 58% of the total weight of an ICE-vehicle is steel. Flat steel products amount to 46% and long products to 11% of total weight.
The average copper content in OECD steel scrap currently ranges between 0.2-0.25%. Copper concentration in shredded end-of-life vehicle (ELV) scrap can range from 0.23% to 0.7%. A shredded scrap sorting trial conducted by ArcelorMittal showed a copper content of 0.6%. This high copper contamination prevents the use of recycled steel in automotive applications. The automotive sector requires effective copper removal techniques from steel scrap to enable the production of high-quality recycled steel suitable for its needs.
About 60% of the copper in a vehicle is in the wire harness and in the engine, e.g. in the ventilation and heating systems. If about 50% of the main wire harness can be removed prior to shredding, this, combined with the dismantling of electric motors and generators in BEVs, could reduce the copper content in steel scrap from about 0.4% to about 0.2%.
The study shows that it is technically feasible to effectively reduce the copper contamination of scrap-based steel from 0.4% to 0.06%, so it can be used in the production of automotive-grade steel in EAFs.
This is achieved by dismantling the main wire harness and electric motor before shredding and through mechanical processing of the steel scrap after the shredder.
Copper treatment can be economically feasible
The comparison of the additional costs with the possible additional revenues shows that a separation of the copper could already be economically feasible today, for vehicle recyclers and for post-shredding sorting plants.
That this does not happen is due to the fact that such further processing would require additional investment for the shredder companies, which is not economic given the current low demand for high-quality steel scrap.
However, the study shows that if there is a market for high-quality steel, e.g. via mandatory recycled content targets, then additional investments will be economically feasible.
There is enough steel scrap available for recycled-content targets
The quantities of recycled steel that can be recovered from ELVs in the EU will be sufficient to achieve a recycled content target in the automotive sector of 30% from closed-loop post-consumer scrap by 2030 and 40% by 2035.
The potential for closed-loop ELV recycling in the EU could be significantly higher than it is currently. Eurostat data shows that only 50% of vehicles placed on the EU market are disposed of and recycled within the EU. The remaining 50% is used car exports, and missing vehicles. However, the valuable materials in electric cars have increased OEM interest in establishing closed-loop recycling within the EU.
Recycled-content targets will create economic benefits for the EU
Authorized Treatment Facilities/Vehicle Recyclers will be able to collect up to €125 million annually in additional revenues by 2035 through the sale of copper that has been removed from ELVs.
T&E calls the European Parliament and the European Council to take action to increase the use of recycled steel in new cars within the ELV Regulation, instead of waiting for a future feasibility study and further delaying action. The evidence from the Oeko Institut study shows that it is feasible and economically desirable to set a 30% recycled steel target in 2030 and a 40% in 2035, as well as dismantling requirements of copper-rich components, combined with quality requirements for recycled steel, specifically a copper contamination level of no more than 0.1%.
