We will proactively contribute toward the circular economy by integrating a circular approach into its products and solutions.
We will contribute to the circular economy by integrating recycled materials into our product platforms, promoting recyclability, using more sustainable packaging solutions, increasing the availability of spare parts to repair our products, and developing circular business solutions.
Read more about our progress on this Promise
As the global middle class is expected to almost double in size by 2030 1), the demand for material resources will increase together with the demand for goods and services. For Electrolux, this means we can expect the price of materials such as steel, plastic and electronic components to become more volatile.
At the same time, many industries are based on virgin materials that are non-renewable and fossil-based. For example, more than 400 million metric tons of plastic are produced globally each year and only about 12% comes from recycled materials.2) Pollution from non-degradable plastic is also a serious issue as it can leach into the environment.
However, there are opportunities to source materials with recycled content, and even bio-based materials from renewable sources.
Sources: 1) The unprecedented expansion of the global middle class, Brookings , 2) OECD Environment Policy Paper no. 12, 2018
There is an urgent need to reduce the pressure on raw material resources and the environmental impacts associated with their extraction. One way to do this is to move toward systems that are more circular and ensure the maximum value from resources by recovering and reusing materials at the end of each service life.
According to the 2020 Circularity Gap Report by Circle Economy, only 8.6% of the resources used globally are cycled back into the economy after use, which is even lower than the year before. The report stresses the need for a circular economy that makes better use of resources to prevent further and accelerated environmental degradation and social inequality.
Consumers are increasingly demanding more circular products and solutions. This includes everything from recycled materials incorporated into our products and more sustainable packaging, to solutions that enable them to extend the lifespan of their products.
Virgin materials cause considerable greenhouse gas emissions through their extraction and manufacture. For example, the emissions from the production of plastic in our products are approximately equivalent to the emissions from our operations and transport activities combined.
Recycled materials on the other hand can have substantially lower greenhouse gas emissions. This means that increasing the amount of high-quality recycled materials in our products can make an important contribution to combating climate change. Steel is the largest material we use by volume and is an even greater source of CO2 emissions than plastic. By sourcing scrap-based steel, we can make a significant reduction in our CO2 footprint from materials.
Emissions can also be reduced by extending the useful lifetime of our products. This can be achieved through promoting more circular business models or providing aftermarket services that ultimately make better use of resources.
This Promise involves working with multiple topics that contribute to our capacity to be able to offer more circular products and business solutions:
Overcoming these challenges requires strategic partnerships with partners throughout the value chain. Partnerships are also sometimes required to create circular business models that create common value for Electrolux and its partners.
In 2020, the amount of recycled plastic we used compared with last year increased slightly from 6,400 metric tons in 2019 to 6,800 metric tons in 2020. The small increase in 2020 is significant when considering that our total volume of sourced plastic actually decreased.
We are working to better incorporate recycled plastics into new products from the outset. In 2020, we held internal workshops to promote the incorporation of recycled plastics in new product platforms. We are also making good progress with trials of incorporating recycled plastic in Asia Pacific and the U.S. In all regions, we are now mapping the way toward our 2030 target.
Progress in incorporating recycled plastic is difficult due to a lack of local supply with sufficient quality outside Europe. However, we see supply developing and will continue to step up our efforts to drive progress in the coming years.
Electrolux has also signed up to the EU plastic pledge, which is a campaign to promote the use of more recycled plastic.
We saw a continued reduction in our use of recycled steel in 2020 compared with the previous years. This is mainly due to the ongoing trade conflict between the U.S. and China. Restructuring of manufacturing and the covid-pandemic also negatively affected the amount of recycled steel used in 2020.
In 2020, Electrolux further developed its popular fixed price repair services in Europe. The service gives consumers peace of mind by ensuring no hidden costs to repair and extend the lifetime of their products. Customer satisfaction studies have shown a very positive response.
New pilot projects with municipal housing companies in Sweden were started with funding from Vinnova. The concept involves leasing large appliances such as washing machines to landlords with furnished apartments. The appliances are maintained and serviced by Electrolux to optimize their lifetime. A similar pilot was launched for holiday homes in Denmark in 2020 where holiday homeowners pay a monthly fee for leasing a package of 2-8 appliances.
Electrolux has also begun trialing new subscription-based business models. For example, the award-winning Pure i9 robotic vacuum is being offered on a trial subscription pay-per-use basis in Sweden with all service and maintenance included in the fee. The model, which grew in 2020, is designed to be affordable for consumers and ensures that each unit is used to its fullest extent throughout its lifetime.
While Expanded Polystyrene (EPS) is an excellent material for protecting packaged products, it is a petroleum-based foam that is difficult to collect and recycle. We are actively looking to eliminate EPS from our various product lines by replacing it with more sustainable packaging solutions. Such alternatives might include other synthetic foams that are more recyclable and reduce CO2 emissions, or bio-based cellulose packaging.
In 2020, we tested different prototype packaging and established the necessary processes to enable us to eliminate EPS. All packaging solutions must be thoroughly tested to ensure they fulfill their objective of protecting the packaged product.
Partnering on circular economy
Circularity requires that we work closely together with our partners throughout the value chain.
During 2020, we developed our cooperation with Stena Recycling to investigate and better understand why working appliances are thrown away. We also signed an agreement with competitors on developing a standard grade of recycled plastic for certain components to improve the market for recycled plastics.
| Roadmap 2020 to 2030 | Next steps | Status |
|---|---|---|
Where possible replace virgin materials with recycled materials in our products. | Expand strategic partnerships with suppliers. Leverage experience from Europe in other regions. Create roadmaps with milestones on how to achieve our 2030 targets. | dot2 |
By 2030, our goal is for our product ranges to be made from at least 50% recycled plastic. | Focus on purchasing and R&D efforts to enable the introduction of recycled plastic in more applications. Improve and develop our communication around products made from recycled material. | dot2asdf |
Increase the amount of scrap-based steel in our production. | Continue to leverage experience from North America in other regions and identify suppliers of scrap-based steel outside North America. | dot2 |
Identify and evaluate relevant circular business models that can be scaled up. | We will continue to identify and evaluate initiatives, with the aim to scale up the most successful. | dot2 |
On track
Additional effort is required
Off track
Work has not yet begun
Electrolux is a leading global appliance company that has shaped living for the better for more than 100 years. We reinvent taste, care and wellbeing experiences for millions of people around the world, always striving to be at the forefront of sustainability in society through our solutions and operations. Under our brands, including Electrolux, AEG and Frigidaire, we sell approximately 60 million household products in approximately 120 markets every year. In 2019 Electrolux had sales of SEK 119 billion and employed 49,000 people around the world.
S:t Göransgatan 143
SE-105 45 Stockholm, Sweden
