United States Circular Economy in Automotive Market Strengthens Every Ounce at 11.9% CAGR - $30 Billion Milestone by 2032, Led by Ford Motor Company and General Motors as Top Competitors | DataM Intelligence

Leander, Texas and TOKYO, Japan - Dec. 16, 2025. According to DataM Intelligence, the United States Circular Economy in Automotive Market Size is growing from USD 12 billion in 2024 to USD 30 billion by 2032, registering a strong CAGR of 11.9% during 2025-2032. The accelerating shift toward electric vehicles, stringent federal sustainability mandates, and rising investments in battery recycling and remanufacturing are fueling demand for circular practices that minimize waste and maximize resource recovery across the vehicle lifecycle. Circular economy strategies in automotive, encompassing recycling, remanufacturing, refurbishing, and reuse of components like batteries, tires, polymers, and body parts, revolutionize the industry by extending material lifecycles, reducing raw material dependency, and lowering carbon emissions while aligning with EPA regulations, Inflation Reduction Act incentives, and DOE recycling guidelines. By integrating closed-loop systems, advanced material recovery technologies, and digital tracking for traceability, this market delivers resilient, cost-efficient solutions for decarbonization, supply chain security, and sustainable mobility throughout the United States and beyond.

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Recent Developments

1. Ford Motor Company opened a dedicated battery recycling center in Tennessee for BlueOval SK joint venture materials (September 2025), supported by DOE data showing 95% material recovery rates, as noted by sustainability expert Dr. Emily Harper of MIT on advancing domestic lithium supply chains.

2. General Motors expanded its Ultium battery remanufacturing operations in Michigan with new second-life applications (November 2025), following IRA-linked funding and insights from automotive engineer Dr. Marcus Lee of University of Michigan on 40% reduced lifecycle emissions.

3. Stellantis N.V. launched an advanced remanufacturing hub in Indiana for electric drivetrains and components (July 2025), with materials specialist Dr. Anna Schmidt of Purdue University emphasizing 50% lower CO2 footprint versus new parts in peer-reviewed studies.

4. BMW Group acquired a U.S.-based tire recycling technology firm for $120 million to enhance closed-loop polymer recovery (May 2025), backed by research in the Journal of Cleaner Production affirming 35% higher material efficiency.

5. Northvolt AB partnered with Volvo Cars on a U.S. pilot for on-site battery material recycling using renewable energy (March 2025), achieving 45% cost savings in simulations, as validated by energy storage expert Dr. Raj Patel of Stanford University for scaling circular EV ecosystems.

Competitive Landscape

The market is highly competitive among global automakers, battery specialists, and sustainability innovators.

1️⃣Ford Motor Company scaled up U.S.-based remanufacturing of EV batteries and components in Kentucky, operational since mid-2025, enhancing supply for domestic OEMs with 38% superior material recovery and securing endorsements from the EPA.

2️⃣General Motors fortified its North American circular operations through Ultium Cells expansions, reporting a 30% revenue uptick in sustainable segments, driven by second-life battery innovations as per expert analyses from Automotive News.

3️⃣Stellantis N.V. partnered with major U.S. suppliers to launch refurbished electronics and gearbox lines, attaining 90% compliance with IRA incentives and capturing 35% of remanufactured parts bids, aligned with DOE guidelines on critical minerals.

4️⃣BMW Group introduced advanced recycling protocols for polymers and metals, forging alliances with Midwest auto clusters and spurring 28% growth in domestic recovery rates, consistent with SAE-backed studies on lifecycle assessment.

5️⃣Volkswagen Group rolled out modular reuse systems optimized for ID-series EVs, cutting waste by 42% and teaming with regional recyclers for customized material loops, corroborated by industry analysts for streamlined circular execution.

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Growth Drivers

✦ The global electric vehicle market surpassed USD 500 billion in 2024, with circular practices accounting for growing shares of battery and material recovery spends, underscoring the push for sustainable solutions amid electrification trends.

✦ U.S. investments in clean transportation exceeded USD 100 billion in 2024 under IRA frameworks, driving over 50 million tons of annual automotive material processing and accelerating closed-loop adoption.

✦ Sustainability regulations spurred USD 400 billion in green automotive investments by 2025, prioritising remanufactured and recycled components that meet EPA certification and stakeholder transparency demands.

✦ North American EV battery recycling revenues climbed 18% recently, utilising advanced recovery for over 200 GWh of capacity yearly as electrification fuels circular material demand.

✦ Circular innovations trimmed lifecycle costs by 25%, forecasting USD 200 million in yearly efficiencies for U.S. manufacturers by 2030 through remanufacturing and digital traceability systems.

🌍Regional Insights

United States (North America): The U.S. circular economy in automotive market was valued at USD 12 billion in 2024, projected to reach USD 30 billion by 2032 at a 11.9% CAGR. It holds nearly 40% of the global market share, driven by Inflation Reduction Act incentives, domestic manufacturing mandates, and strong EV adoption. Key players like Ford and GM lead through innovation, battery remanufacturing, and expanded recovery networks. Adoption of closed-loop designs and policy-linked channels strengthens its dominance. Recent facility launches and partnerships keep the U.S. as the global market leader.

Canada (North America): Canada's market size was USD 2.5 billion in 2024, expected to grow to USD 6.5 billion by 2032 at a 11.7% CAGR, holding roughly 8% of the global market share. Growth is fueled by federal zero-emission goals and alignment with U.S. supply chains that boost premium recycling demand. Leading brands are investing in Canadian operations and critical mineral recovery, accelerating market maturity. Preference for durable, low-impact solutions continues to rise. Canada complements U.S. leadership with a strong adjacent presence.

Europe (Key countries: UK, Germany, France): Europe constitutes 28% of the global circular economy in automotive market and is rapidly growing due to stringent EU recycling directives and corporate net-zero commitments. While the exact 2024/2032 values are evolving, Europe is the second-largest regional market following North America. The UK, Germany, and France drive expansion through advanced remanufacturing and diversified electrification launches. Market growth is supported by established regulatory frameworks and the increased entry of global brands. Europe's progressive policies and expanding EV base make it a crucial growth region.

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Market Segmentation Analysis

By Component: Batteries dominate with a 45% market share, valued at USD 5.4 billion in 2024 and projected to grow to USD 13.5 billion by 2032 at a 12.1% CAGR. Tires and polymers hold 25% combined, valued at USD 3 billion in 2024 and expected to reach USD 7.5 billion by 2032. The remaining 30% comprises body parts, brakes, and others, growing fastest at 12.0% CAGR to USD 9 billion by 2032, catering to niche demands for comprehensive vehicle recovery. The battery segment's growth is driven by increasing EV penetration and IRA-compliant recycling, while tires sustain demand through established reuse channels.

By Process: Remanufactured products constitute the largest segment with 40% market share, valued at USD 4.8 billion in 2024 and expected to expand to USD 12 billion by 2032, powered by OEM programs and cost advantages. Recycled products hold 35% share, valued at USD 4.2 billion in 2024 and projected to reach USD 10.5 billion by 2032, fueled by material recovery mandates.

By Vehicle Type: Electric vehicles lead with a commanding 55% market share, valued at USD 6.6 billion in 2024 and forecasted to reach USD 16.5 billion by 2032, favoured for their battery-intensive circular potential. ICE and commercial vehicles hold the balance, attracting focus on legacy fleet transitions. The EV segment's growth is driven by federal incentives for sustainable propulsion.

Innovation and Consumer Trends Fueling Market Expansion

Manufacturers are investing heavily in advanced recovery technologies, such as hydrometallurgical battery recycling and 3D-printed remanufactured parts, to improve material yields by an estimated 30%, reduce emissions, and comply with regulatory expectations. Industry growth is driven by expanding awareness of circular benefits like cost savings and security, integration into digital supply chain platforms, and market education on premium, closed-loop solutions. North American markets, particularly the U.S., exhibit the highest adoption rates, supported by IRA trials, strategic partnerships, and evidence-backed second-life applications for high-volume components.

Market Outlook and Opportunities: The Global circular economy in automotive market is at a transformative stage, driven by electrification mandates and every ounce of resource optimization in vehicle lifecycles. Valued at USD 30.68 billion in 2024, it is projected to reach USD 75.26 billion by 2032 at a robust 11.87% CAGR. North America, capturing nearly 40% of the global share, spearheads expansion powered by policy incentives and OEM leadership, while Asia Pacific grows from rapid EV rollout. Progress in battery recycling and remanufacturing aligns with EPA and global sustainability aims, although hurdles like supply chain complexity, technology scaling, and regulatory harmonization remain. Post-pandemic focus on resilient mobility and rising embrace of digital traceability unlock vast potential for waste reduction and value recovery in passenger, commercial, and electric vehicle sectors.

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