Circular Transformation of Industries 2025

The businesses surveyed expect a positive impact from lifespan extension solutions three years from now, but the size of the effect varies significantly by industry and product. GHG emissions: While lifespan extension solutions reduce the need for new products and their associated GHG footprint, the overall impact varies by solution and industry. There is high potential for GHG emissions savings when products are composed of durable materials – which enable a longer extension of the useful life of a product – with high levels of embedded emissions. As this is often the case in the machinery industry, the survey finds that carbon emission savings in this industry are particularly significant. When repairs or upgrades improve device performance and enhance energy efficiency, they further contribute to reducing GHG emissions. Resilience: There is high potential for increased resilience when businesses handle a high share of scarce parts or materials and manage complex supply chains. This is often seen in the machinery industry, where the survey finds particularly significant resilience gains. Lifespan extension solutions mitigate the risk associated with raw material supply shocks and supply-chain disruptions and reduce the dependency on suppliers, as they redeploy parts from used products.2.1 The value of employing lifespan extension solutions Rockwell Automation, a multinational provider of industrial automation and digital transformation technologies, offers repair services for industrial automation products. By repairing machinery for one consumer packaged goods client, Rockwell Automation was able to reduce CO2eq Scope 3 emissions by around 90% compared with manufacturing a replacement.Rockwell Automation also enhanced its resilience by repairing, remanufacturing and refurbishing products, which allowed the company to service customers even in case of material shortages in the market. As an example, Rockwell Automation reduced the turnaround time for one customer by 14 days, compared to the time needed to deliver a new device. Revenue: Lifespan extension solutions can enable businesses to shift profit pools. For example, businesses can attract a new price-sensitive customer segment with refurbished goods. They can also increase customer engagement through repair and a wide variety of other services. However, businesses must build trust in the value of second- life products and ensure that the take-back process is smooth. There is particularly high potential for revenue increases when lifespan extension solutions increase a product’s performance and lifespan substantially or when customers face long lead times for new products. This is often the case in the machinery or automotive industry (the business- to-business sector), where the survey finds that revenue increases are especially significant.Cost: Lifespan extension solutions have the potential to reduce costs, but the cost impact varies significantly by company and depends on internal capabilities. These models are labour intensive and require high initial investments. Businesses are able to offset these when lifespan extension measures align with their core expertise and capabilities, especially if they already rely heavily on manual processes in their linear operations. This is often the case in the machinery industry, where the survey finds particularly significant cost decreases. Businesses successful with this archetype also decrease customer acquisition and retention expenditure through the circular solution’s continuous life-cycle engagement, and leverage design for circularity to cut material input costs. Circular Transformation of Industries: Unlocking Economic Value 15