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Friday, November 09, 2007

European Update

EGARA, the umbrella auto recycling association in Europe, meets next week in Brussels. As a prelude to the meeting they issue country reports providing status reports, new initiatives, etc. I have extracted a few of the germane concepts to show what our European brethren are dealing with. We seem to be all "suffering" from high scrap prices, unfair competition, and porous regulatory schemes.

• Illegal operators allowed to continue in business - affecting trading conditions.
• Vehicle salvage is still a sought after commodity, particularly 3 to 7 year old vehicles, pushing prices higher.
• Illegal activity of non-licensed sites is being pursued by the EA (Government). We at the MVDA believe this should be more energetic, with more resources thrown at these sites, rather than the ‘softer’ option of visiting those sites who want to comply, and are already licensed.
• Shortage of naturally arising ELV’s going to dismantling sites, we feel many go straight to the shredder
• Working with the Department of Trade and Industry (DTI) and the Environment Agency (EA) to determine the official text defining the moment a motor vehicle becomes an ELV.
• Unlicensed sites – reporting known ones to the EA for action to be taken
• Putting pressure on government for changes to UK legislation re: COD's (Certificate of Destruction). There will be only 946,000 COD’s issued but 2 million vehicles reaching end of life this year!

• High scrap metal prices but the future is uncertain and there is a risk that we will see many abandoned ELVs.

• In Poland 80% of ATFs (Authorized Treatment Facilities) now use shredders. ATF send scrap metals directly to steelworks.
• In Poland we have still problem that a lot of cars are not treated in ATF (90%)
• Every year, more than 100,000 ELVs cross the border and are dismantled by grey area in Poland.
• Control of flow cars between countries are needed.
• We need a control of number deregistered cars and number of ELVs treated by ATF to be sure that all car are treated by recycling system.

• 23 members of the Danish association are now ISO 9001:2000 Quality Certfication approved by the authorities and many of them for the third time!
• Our problems in Denmark are still the high prices when buying cars on the insurance internet-platforms.

• Norway has a wreck deposit system where the last owner receives approximately 190€ ($260 Cdn) when the car is delivered to an approved ATF (a wreck deposit receipt is then being issues and the car is then defined an ELV). The wreck deposit system has been organised by the government since it was implemented in 1978 and has been very successful.
• The high scrap metal prices attract new actors to the business. The competition is getting harder.
• The concern however is that new actors do not focus on reuse. We have made an inquiry to the Ministry of the Environment to specify stronger in the Norwegian regulation for ELV the priority of reuse before recycle.

• With the high scrap price, a large number of illegal operators are running after ELVs who would disappear if the prices were going down. They affect trading conditions.
• There is lack of elvs and more precisely salvage cars.
By the end of the year, the government has planned to re-start a take-back action of older or more polluting cars in exchange of a premium which could reach 1000€ ($1,390 Cdn)

• All dismantlers have to get their licence to continue their activities. This licence has a time limit of maximum 5 years. After this period you have to apply again for it. Important: You must be audited by a third party = certification is compulsory. VASSO-Recycar-Cert is recognized as a valid certification. Dismantlers with no certification have to stop their business immediately.
• As an effect of unbelievable high scrap prices we have too much dealers in our country. They can live from this alone. They will disappear as soon the prices will go down. In them moment it is almost impossible to get enough cars. Even not for very good prices. Spare-part-business runs well, but there is a lack of supply in longer terms.

• Shredders have abruptly risen up the price for cars they paid directly for the last car owners. This way we get fewer cars as before. We do not believe they can treat the cars for recycling according the Directive.

Across Europe, scrap prices are in the $180 to $220 Cdn range.

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