Redesigning machinery for a circular economy

The notion of producing goods without generating waste – something we now call the circular economy – first surfaced in the 1970s. Half a century later, circularity is yet to reach its full potential, although the growing momentum behind it is undeniable. Faced with rising resource constraints, growing sustainability pressures, and a wave of digital innovation, manufacturers are finally beginning to turn theory into practice.

Nearly 60% of industrial equipment (IE) manufacturers now say they see the future of their industry as circular. Even more believe that circular practices will improve their operations, cut costs, and forge deeper customer connections.

Still, meaningful change won’t come from simply ticking compliance boxes. It will come from those who see circularity as a strategic edge. These are the companies that recognize they can unlock new revenue, boost supply chain resilience, and create services around durable, long-life products. By decoupling growth from resource consumption, they can reduce their exposure to material shortages, disruptions and price shocks, and build recurring, profitable income streams that extend far beyond a product’s first life.

The common misconception about circularity is that it’s about recycling more. In actual fact, it’s about entirely rethinking how every product is designed, made, used, and reused. At scale, circular operating models could completely transform the industrial value chain from the one we know today.

What does circular innovation look like for industrial equipment manufacturers?

Circular innovation doesn’t follow a one-size-fits-all approach. In the industrial equipment space, products are already largely built for durability, so the focus shifts more to adaptability, optimization, and smarter strategies for equipment maintenance, recycling and end of life.

Here’s what that could look like:

• Remanufacturing and reuse: Instead of scrapping entire machines, manufacturers give them a second life by reusing valuable components and remanufacturing key systems. Some IE companies already offer rebuilt equipment featuring used or remanufactured parts including engines, suspensions, and transmissions.
• Smart, connected products: Built-in sensors alert operators when something needs fixing, schedule preventive maintenance and flag when a product is due for refurbishment. This real-time feedback loop leads to fewer surprises, less downtime, and smarter decisions about whether to repair or replace.
• Efficient product development: Virtual twins support engineering teams to design, test and improve products in a virtual environment before building anything physical. This speeds up innovation, reduces waste, and makes it easier to plan for reuse or recycling later on.
• New business models: Companies continue to shift to equipment-as-a-service business models where they sell products on a subscription basis bundled with ongoing services. Equipment can now be maintained, upgraded, and taken back after use to be refurbished and resold, extending its life and building more value over time.

What benefits can IE manufacturers expect to achieve?

The business case for circularity grows stronger every year. Remanufacturing alone can cut production costs by 20% to 60% while reducing exposure to volatile global supply chains.

Companies already embracing circularity are seeing real rewards:

• Smaller environmental footprint: Circular supply chains use 28% fewer materials and emit 39% fewer carbon emissions.
• Lower total cost of ownership: Durable, upgradeable equipment delivers better long-term value for customers.
• Stronger customer loyalty: When service is built in, performance is tied to revenue and machines last longer, manufacturers will foster long-term, loyal customer relationships.
• Greater resilience: Less dependence on raw materials and better reuse of assets means companies aren’t as vulnerable to supply chain disruptions and price volatility.
• Regulatory readiness: Transparent data and full traceability across the value chain makes it easier to stay ahead of fast evolving compliance requirements.

“Over 90% of our carbon footprint comes from the materials we use, so we need to do everything we can to reduce waste and optimize resources. Again, this requires a more effective design process.”

Leevi Paajanen

Design Manager, Premekon

Read the full story here.

What challenges stand in the way of circularity?

If circularity holds so much promise, why hasn’t it gone mainstream?

Legacy mindsets are a big part of it. Many IE manufacturers are still locked into linear ways of working: design, build, sell, repeat. Shifting to a circular system demands a fundamental rethink of how everything connects. That kind of systemic change doesn’t happen overnight.

Data is another roadblock. Circular models need rich, continuous data insights, knowing where materials come from, how products perform, and when they need servicing. Too many companies still operate with disconnected systems and don’t yet have the capabilities to see the bigger picture.

And let’s not forget scale. A pilot project or small recycling initiative here and there isn’t enough. Real impact comes when circular thinking is embedded into every phase of the business and product lifecycle, from R&D and manufacturing to delivery, maintenance, and end-of-life recovery.

How can Dassault Systèmes support circular initiatives?

Dassault Systèmes is already partnering with leading industrial equipment firms to put circularity into practice. The 3DEXPERIENCE® platform equips businesses with end-to-end digital capabilities to manage products from concept to reuse, refurbishment, or recycling.

Designers and engineers can use in-built features to assess environmental and ethical impacts right from the ideation phase, resulting in smarter material choices and designs built for future disassembly and recovery.

In production, the platform helps optimize factory layouts and workflows to cut energy use and minimize waste. Once products are in use, real-time operational data is captured and continually monitored to support preventive maintenance and guide decisions such as whether to repair, refurbish, or replace.

All of this is supported by a single source of truth across the entire product lifecycle presented via intuitive, real-time dashboards that turn complex data into clear, actionable insights.

The 3DEXPERIENCE platform can contribute to our environmental, social and governance targets by making our design and industrial processes even more efficient by reducing material waste in production, improving remote collaboration to lessen the need for travel, and supporting us to develop smart, sustainable products.

Luca Toffanin

Group Product Platform Manager and PLM Manager, CAREL

Read the full story here.

The path to circular innovation

When businesses stop seeing circularity as a constraint and use it as a catalyst for innovation, that’s when it’ll really take off. The next few years will be decisive. Experts predict that in the coming decade, many machinery and equipment companies will embed circular operations at the heart of their strategies.

Ultimately, the most successful manufacturers will be the ones who evolve from selling machines to delivering outcomes, creating machinery solutions, not just products, that are sustainable, serviceable, and built to last.

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