EV Drive Motor and Hybrid Transmission Rare Earth Recycling: How Cyclic Materials is Creating New Value Streams for Auto Recyclers

Feb 25, 2024 | Expert Tips, Sponsored

In recent years, the automotive recycling industry has faced a paradigm shift with the emergence of electric vehicles (EVs). This transformation has brought forth fresh challenges and introduced new recycling streams, altering the way end-of-life vehicles are managed.

Adapting to Change: The Evolving Landscape of Auto Recycling

For many years, catalytic converters have been one of the valuable parts of internal combustion engine (ICE) vehicles due to the valuable platinum group metals they contain. Although not as highly profitable as catalytic converters, the value of starters, alternators and other components of ICE vehicles is well understood by auto recyclers for their copper value.

But the global transition to EVs is reshaping this landscape – changing which vehicle parts the auto recycling community covets most. While EVs don’t have catalytic converters, their batteries contain even more valuable metals such as lithium, nickel and cobalt. Auto recyclers are learning how to handle and assess these batteries, and in time, EV battery components will likely surpass ICE vehicles’ catalytic converters in value and profitability.

Rare Earth Elements: A New Treasure Mine Beyond Batteries

Beyond their battery materials, EVs and hybrid vehicles introduce another set of valuable and recyclable metals: Rare earth elements (REEs). REEs are a group of 15 metals, notably neodymium and praseodymium, which make up the permanent magnets in electric motors.

REEs play a crucial role in enhancing the performance and efficiency of vehicles, particularly in the electric motors of hybrid transmissions and the drive motors of EVs. Their presence contributes to making these motors both powerful and lightweight, thereby elevating the overall performance and efficiency of the vehicles. By recycling EV motors and hybrid transmissions, auto recyclers unlock new value streams and can benefit from the growing demand for REEs.

Rare earth elements (REEs) are a group of 15 metals, notably neodymium and praseodymium, which make up the permanent magnets in electric motors.

Overcoming Supply Chain Challenges to Enhance Value and Sustainability

The increasing popularity of EVs is leading to a higher demand for magnets made from REEs. Yet there are operational and environmental challenges with opening and operating mines for these elements, and production is projected to fall short of demand in 2024.

Adding to this problem, over 90% of these magnets are made in China. Depending on a single source for these crucial parts worries North American companies, business leaders and governments. These materials are crucial to the growing EV industry, and any supply chain disruptions or geopolitical events could derail automotive production. 

To move away from this reliance, recycling components such as hybrid transmissions and drive motors –  which contain REEs –  is increasingly vital. When auto recyclers focus on picking these specific parts for processing, they unlock valuable opportunities within the auto recycling industry and help build an independent sourcing network for critical components.

How Cyclic Materials Is Addressing these Challenges?

Cyclic Materials, a cleantech startup based in USA and Canada, is helping build a domestic and sustainable supply chain for these materials, addressing both the production shortages as well as the supply chain risk facing REEs. With its proprietary process to recover REEs from end-of-life EV drive motors and hybrid transmissions, the company is contributing to the sustainable management of resources and creating new economic opportunities in the automotive recycling sector.

Cyclic Materials is currently acquiring these electric motors from automobile recyclers on an ongoing basis and processing them in its first-of-a-kind facility in Canada and has delivered rare earth raw materials to downstream suppliers in the magnet production industry.

How Auto Recyclers Benefit from Picking EV Drive Motors and Hybrid Transmissions:

• Create new value streams: Beyond traditional materials like copper, aluminum, and steel, recycling EV motors and hybrid transmissions introduces new value streams to the auto recycling industry.

• Help develop local supply chains: Processing REE-containing components promotes the development of domestic supply chains, fostering sustainability and self-reliance in the automotive sector.

• Secure the future of the auto recycling industry: As the number of EV and hybrid vehicles continues to grow, the auto recycling sector must embrace new practices to recycle these critical components and recover these valuable metals.

• Contribute to sustainability: Recycling REEs reduces the need for new mines, lessening the environmental impact associated with mining and preserving natural resources.

The future of the automotive recycling industry relies on its ability to adapt to the energy transition and capitalize on the valuable materials within EVs and hybrid vehicles. Through innovative processes and strategic partners, key players within the sector will contribute to the sustainable management of resources and create new economic opportunities.

To find out more about Cyclic Materials, please visit cyclicmaterials.earth.

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