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How GM Makes $1 Billion A Year By Recycling Waste

June 9, 2016 / By Forbes

Forbes: How GM Makes $1 Billion A Year By Recycling Waste

If one man’s trash is another man’s treasure, General Motors has the revenue to prove it.

The automaker generates an eye-popping $1 billion a year reusing or recycling materials that would otherwise be thrown away — everything from scrap steel and paint sludge to cardboard boxes and worn-out tires. It’s an unexpected but welcome revenue stream that comes from rethinking its approach to waste reduction. Manufacturing is a dirty business. Industrial facilities in the United States generate 7.6 billion tons of nonhazardous waste annually, according the Environmental Protection Agency. Most of it ends up in landfills.

At GM, however, waste is viewed not as something to be thrown away, but as a resource out of place. By finding new uses for that waste — or selling it to someone who can — GM diverted 2.5 million metric tons of waste from landfills in 2011 (the equivalent of 38 million garbage bags). When an automaker’s stamping press cuts the shape of a car door out of a flat sheet of steel, for example, there’s a large hole reserved for the window. In most auto factories, the leftover steel cutouts are stacked up, then sold to a foundry, where they are melted with other bits of steel and converted into scrap metal. That’s one way to recycle, but the melting and reprocessing of steel costs money and consumes a lot of energy.

General Motors sees those leftover steel cutouts, roughly four feet square, as a marketable commodity. It sells them directly to a local steel fabricator, Blue Star Steel, which uses them to stamp out small brackets for heating and air conditioning equipment for other industries, skipping the foundry altogether. Everyone benefits: GM maximizes the value of that leftover material; Blue Star Steel saves money buying scrap steel, and the environment is spared additional greenhouse gas emissions from a foundry. Worldwide, 90 percent of GM’s manufacturing waste is reused or recycled this way — more than any other automaker, according to Two Tomorrows, a sustainability consultant in San Francisco. GM has a total of 104 landfill-free facilities worldwide, including 84 manufacturing sites that reuse or recycle 97 percent of their waste, and convert the remainder to energy. Its goal is 125 landfill-free facilities globally by 2020.

Source: Forbes