The Ellen MacArthur Foundation has released a new report outlining how a circular economy approach to electric vehicle batteries could mitigate critical mineral supply risks and create competitive advantages for industry stakeholders. The report, titled “Leading The Charge – Turning risk into reward with a circular economy for EV batteries and critical minerals,” launched at the World Economic Forum in Davos.
Highlights
- Critical mineral supply shortfalls are projected for the mid-2030s, with potential 40-50% consumer price increases under sustained battery metals supply disruptions
- Typical EVs contain over 200 kg of critical minerals—six times more than conventional vehicles—with most value concentrated in the battery
- Five leadership priorities identified to scale circular battery infrastructure across design, business models, and regional systems
- Industry endorsements from CATL and Volvo Cars signal growing support for circular approaches across the EV value chain
Supply Chain Vulnerabilities Drive Circular Imperative
The report draws on insights from more than 30 industry players across the EV battery value chain. According to the Foundation, EVs are projected to represent 65% to 75% of global car sales by 2050, intensifying demand for battery materials.
The International Energy Agency has previously indicated that sustained supply shocks in battery metals could result in significant consumer price increases. The Foundation’s analysis suggests a circular approach could reduce costs for automakers, derisk investor returns, and decrease import dependence for governments.
Five Leadership Priorities Identified
The report establishes five strategic priorities for advancing circular battery systems:
- Design for circularity: Engineer batteries for longevity and reuse across multiple life cycles rather than single-use disposal
- Optimize energy-mobility systems: Shift focus from larger batteries to co-optimized systems that maximize circular potential without compromising function
- Scale circular business models: Treat critical minerals as long-term assets through service models that incentivize durability, performance, and recovery
- Build regional infrastructure: Develop and co-invest in circular infrastructure enabling efficient, resilient, and transparent material circulation
- Establish circular operating systems: Implement industry-wide data sharing solutions and policies that maintain products and materials in circulation
Industry Stakeholders Signal Support
Jiang Li, Vice President and Board Secretary at CATL, stated the company intends to collaborate with the Foundation and value chain partners to implement circular principles. CATL serves as a strategic partner to the Ellen MacArthur Foundation.
Vanessa Butani, Head of Global Sustainability at Volvo Cars, emphasized that electrification must proceed alongside circularity to reduce risk, safeguard resources, and accelerate the transition to climate-neutral mobility.
Foundation Commits to Multi-Year Initiative
The report represents the Foundation’s initial phase of a multi-year campaign focused on accelerating critical mineral circularity within the EV battery sector. The organization, established in 2010, works with global leaders to mobilize business and policy action toward circular economy solutions.
Circular economy strategies for EV batteries include maintenance, repair, refurbishment, remanufacturing, second-life applications, and high-quality end-of-life recycling—approaches designed to retain the strategic value of critical minerals.
Sign up for our popular daily email to catch all the latest EV news!
