An old car may be more valuable when scrapped than when sold.

The fact that falls into the old category "few know" - BMW is currently celebrating its50th anniversary of car production in South Africa. The German giant first opened a plant in Rosslyn, near Pretoria, in1973. Initially, it produced cars only for the South African market (including several exclusive models that are now attracting collectors' attention), and later began exporting cars worldwide, including to Ireland.

Of course, South Africa, like us, is a market with right-hand traffic.

The 50th anniversary of production — in a factory that stood against racial segregation outside of South Africa — is a significant event. Perhaps even more noteworthy is BMW's later investment in a new facility in this country, which could facilitate, and possibly prove profitable, the process of dismantling cars.

On the outskirts of Pretoria, in a building made of glass and steel that could remind one of an industrial complex in Sandyford—if Sandyford had such sunshine—lies the BMW ZA Hub. It feels like a small piece of Google, but with a Munich twist. The employees who work here are called "hubsters." There’s a presentation area on the roof designed like a mini-amphitheater with hippos and cushions. The uniform includes dark blue Converse-style sneakers. It all feels very much like Silicon Valley.

BMW has three similar hubs. The other two are located in Munich and Portugal, and all three are working on the software development needed by the company. If you have recently used the touchscreen in a BMW car, you were using software developed in Portugal. The South African ZA Hub is working on the software that BMW itself uses — the software that manages its global network of factories, communication between the headquarters and dealers, as well as financial services. All of this is critically important, but there is no direct contact with the customer.

However, ZA Hub is currently working on software that could completely change the nature of car ownership, sales, disposal, and upgrades. BMW is starting a project to create a truly "circular" car. No, it's not a round 3 Series, but a car that is fully recyclable and made from recyclable materials, from the steel and aluminum in its body to the upholstery, lithium, and nickel in the battery.

A circular car does not require the extraction of fresh metals or the cultivation of cotton or the plastic molding of plastics. It will be practically carbon-neutral.

However, this requires a large number of old cars to return to the system so that their metals, plastics, and upholstery can be collected and recycled. Currently, this often does not happen, particularly because it is difficult to accurately determine the value of a car after it has been dismantled into parts.

The new digital twin software ZA Hub could change all of this. We are used to the concept of a digital twin in the context of manufacturing processes. Imagine a factory created in digital form. This digital version can operate in real-time, always performing everything precisely.

The digital twin of a car is slightly different. Duyjon Fredericks works with vehicle-related data systems at ZA Hub and says, "For every physical car we produce, there will ultimately be a digital representation of that car, including all hardware and software and individual features. It then follows the physical car throughout its life, so to speak, from cradle to grave."

This is exactly what distinguishes it from the usual documentation that accompanies and identifies a new car — the BMW digital twin can be continuously updated with maintenance data using direct data links between the factory and the car itself, including over-the-air software updates. It's like a digital Dorian Gray — there is a version that shows the car as it was originally built and sold, and alongside it, a version that ages with the car, showing what has broken, what has been replaced, and what has been updated.

This is related to compliance with new regulations on automotive data and identification, including carbon dioxide monitoring systems in the EU and extremely strict import and sales rules in China.

There is another interesting point. "BMW's CEO, Oliver Zipse, made a bold statement," says Fredrik. "He stated that he wants BMW to become the most environmentally friendly car manufacturer in the world. But right now, only 30% of the materials we use in each car are recyclable."

As automakers increasingly require recycled and reusable materials for manufacturing their vehicles, the cost of these materials will rise. This will completely change the way we trade and ultimately dispose of our cars. The BMW ZA Hub is exploring ways to monitor the value of individual components and materials of a vehicle in real-time using a digital twin.

“We think of the cars on the road as the raw material of the future,” says Tereso Mogovare, senior software engineer at BMW for the digital twin project. “For each of these cars, the digital twin allows us to drill down to the level of individual components, to every single part.”

“For each of the batteries in the car, for example, we not only know the number of kilograms of lithium in each battery, but we can also monitor the condition of that battery in real time. And if we know this and the volume of each material in each car, we can create a forecast of the monetary value of each component and the entire vehicle.”

"Thus, you can look at the retail price of the car itself or compare it with the cost of individual components as secondary recycled materials."

Mogovare presses several buttons on the tablet, and a trading screen appears in real-time, showing the value of each part of an aging car based on the daily market values of each strip of lithium and each kilogram of aluminum. This means that you can potentially find out the point at which your car is actually valued more as scrap metal than as a used vehicle.

ZA Hub "Hабстеры" also predicts a time when BMW — which will be watching all of this all day, of course — will be looking for your car and hundreds like it to supply its raw material warehouses for creating new ones.

Futures for automotive recycling could even emerge, says Mogovare: "BMW will be able to sell tokens based on documented information about these materials, using projected value. In fact, you will be able to trade the value of materials that are still in use."

The existing consequences are enormous. Prices for used cars could skyrocket if they become a significant source of material for new cars. Additionally, the increase in these values will allow automakers to offset a large portion of the final purchase cost, leading to much cheaper PCP financing packages. The predicted future value not only of the car as a used vehicle but also of the value of recycled material could become a major component of such financial deals.

There may also be changes in the insurance market, as insurance companies could become even more proactive in reporting on lightly damaged vehicles, seeking to capitalize on the raw materials embedded in them. All of this is accompanied by related issues in data security and privacy.

The former South Africa BMW was best known among car enthusiasts for creating rare vehicles like the 7 Series limousine with an engine from the supercar M1 and the fair six-cylinder competitor M3, which was only available with right-hand drive. In the future, the South African base may become much more well-known due to a complete transformation of the car buying and ownership process.