Assessing rebound effects in circular economy: insights from the automotive industry

Circular Economy (CE) practices are adopted in the manufacturing industry to minimise the use of virgin and hazardous materials and the production of waste, turning out to be effective in addressing multiple sustainable development goals. Circular manufacturing (CM) involves several strategies, such as remanufacturing, product-service systems, waste management, and disassembly. Despite all the sustainable benefits associated with the implementation of CM strategies, they could also be hampered by the occurrence of negative consequences, the so-called rebound effect (RE). RE is defined as an efficiency improvement in production that unexpectedly increases demand for and consumption of resources. In trying to understand how, where, and why RE occurs in applying CE in manufacturing, the literature revealed a main gap: the lack of industrial applications. To address this main gap, the automotive industry, which is one of the main contributors to pollution, has been investigated. A systematic literature review to explore RE within the automotive industry has been conducted, and a series of practitioners belonging to automotive companies have been interviewed to evaluate their CE adoption and RE awareness. The objective was to investigate the level of awareness and knowledge of the possible occurrence of different types of RE within CE in the automotive industry, relying on both theoretical and practical investigations. In particular, the research evaluated and raised companies’ awareness about REs’ possible occurrence, detected the principal strategies adopted by companies to maximise resource value and minimise negative environmental impacts, and explored current practices in manufacturing on how to detect, reduce, and prevent possible negative consequences that could decrease the expected benefits of CE. Finally, this research provides insights to both managers and policymakers, also defining a baseline for future research on how to cope with the RE of CE.