The transition to electric vehicles and a net zero economy: A model based on circular economy, stakeholder theory, and system thinking approach

Greenhouse gas emissions and air pollution are major contributors to climate change, causing harm to both the planet and people. Since transportation is a significant source of these emissions, several European countries have implemented plans to switch to electric cars and decrease emissions by 2050. However, this transition presents many challenges, including issues with redesigning supply chains, scarcity of raw materials, and impacts on employment, technology, mobility behaviour, and infrastructure. The aim of this study is to develop a model based on system dynamics and agent-based approaches to evaluate effects of the electric and net zero economy transitions on the automotive supply chains and relevant stakeholders. The study incorporates principles of circular economy, stakeholder theory, and system thinking approach. The research considers various stake-holders such as automotive manufacturers, suppliers, and workers, and it explores several operations such as production, de-manufacturing, and end-of-life activities for three types of vehicles: fuel, hybrid, and electric. The results of the model show that a transition towards electric vehicles and a net zero economy is only possible through the implementation of circular economy, which can generate new business opportunities, reductions in raw material consumption, and a resulting increase in competitiveness; however, at the same time, this transition can have several implications for job. Indeed, the EV transition will significantly reduce the number of manufacturing jobs available in the automotive industry due to an increase in automation, fewer moving parts, and simpler engines. Therefore, it is fundamental that companies and policy makers use the results of this study to reduce the negative effects on employment and plan specific programs and policies to support the developing of new skills for workers and favour their relocation in the supply chain (i.e., end of life activities).

Automated summary

Greenhouse gas emissions and air pollution contribute to climate change and harm the planet and people. European countries are transitioning to electric cars to reduce emissions by 2050, but face challenges in redesigning supply chains, scarcity of raw materials, and impacts on employment and infrastructure. This study uses a model to evaluate the effects of the electric and net zero economy transitions on automotive supply chains and stakeholders, considering circular economy principles and various operations for different vehicle types. The results show that the transition requires circular economy implementation, which can generate business opportunities and reduce material consumption, but also has implications for job loss. It is crucial for companies and policy makers to use these findings to mitigate negative effects on employment and support workers with new skills and relocation in the supply chain.