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Saturday, December 20, 2008

BERR expresses “real concern” over ELV disposal

BERR (UK Department for Business Enterprise & Regulatory Reform) has expressed "real concern" over the proper disposal of scrap vehicles following the sharp fall in metal prices and claimed that the producer responsibility system is now being seriously called into action for the first time.

Under the End of Life Vehicle Regulations, producers are responsible for helping to fund the recycling of scrap vehicles, and must join one of two network providers - Autogreen and Cartakeback - who provide a network of authorised treatment facilities (ATFs) offering free take-back of ELVs.

End-of-life vehicles can be returned free of charge to any authorised treatment facility within the producer-funded networks

While vehicle manufacturers have had an easy ride in recent years, with the high value of metals making take-back a profitable option for both ATFs and the last owners of vehicles, the sharp decline in metals prices is likely to see them playing a larger part in subsidising the service.
In a statement, BERR said the drop in metals prices meant "the proper disposal of scrap vehicles is once again becoming a real concern - particularly in remote rural areas of the UK."

And, economics and business minister Ian Pearson said: "We know the scrap metal market is experiencing difficulties at the moment and it's precisely for these sorts of circumstances that the ELV Regulations were designed."

"It doesn't matter what the value of a scrap car currently is - under the requirements of the Regulations, automotive manufacturers have established networks of convenient facilities where vehicles can be returned at no cost to the last owner. They will ensure the car or van is properly treated and at least 85 per cent of it is recycled and put to new uses," he added.

While the producer responsibility system for ELVs has been in place since January 2007, Mr Pearson described the current situation as the first time that the free take-back option had been "seriously called into action".

"It's now more important than ever that people are aware of this service so we can minimise the potentially damaging impact of fluctuating metal prices on local authorities, who have a duty to collect abandoned vehicles," he added.

His comments come after vehicle dismantlers expressed concern that the drop in metals prices could trigger a "dramatic" increase in the number of abandoned vehicles.
Under the ELV Regulations 'free take-back' guarantee, ATFs within the networks must provide a free collection service for last owners of vehicles who live more than 30 miles from their nearest facility.

ATFs are also expected to issue a Certificate of Destruction confirming that a vehicle has been destroyed and informing the DVLA that the last owner's licensing responsibility had ended.

Warning of “dramatic” increase in abandoned cars

Vehicle dismantlers have warned that the major falls in metal prices in recent weeks could trigger a 'dramatic' increase in the number of cars left abandoned in the streets, writes Nick Mann.

More vehicles are already being abandoned on the streets following recent falls in metal prices. And, the price falls have prompted concerns that some companies contracted to councils to collect ELVs on bahalf of councils will not be able to honour their agreements.

But, there was good news for some car dismantlers, as Autogreen - one of two networks of treatment facilities allowing vehicle manufacturers to meet their recycling obligations under the ELV Directive - revealed it would forgo the charges it levies on its member facilities for producing Certificates of Destruction and logging them on its system, to help them through the difficult predicament.

In a statement released to, Autogreen said: "In light of the current economic climate and to further support its members in achievement of the regulatory 85% recycling target for ELV's, Autogreen has took the decision to assist its members, by offering a zero cost route to data reporting and assisted compliance, for all vehicles handled by those facilities associated with Autogreen."

This means that, from November 1, there will be no charge for facilities when they issue a Certificate of Destruction (CoD) and enter it onto the network's on-line reporting system.

And, the organisation confirmed that this change would apply to the issuing of CoDs for all vehicles and not just those manufactured by one of its contracted brands.

Speaking to today about the issue of an increase in abandoned vehicles, Richard Reynolds, the national contract manager for London-based car recycling firm Redcorn said: "It could go back to the bad old days when you see vehicles abandoned on the streets"

He revealed that his company, which holds contracts to collect abandoned and nuisance vehicles for 12 local authorities, was "already getting calls from councils about cars being left in car-parks," and claimed that "just after Christmas you're going to see it beginning to pile up".

In the past, he explained that the high cost of metals would have meant that those abandoned vehicles would instead have been taken to unlicensed car dismantlers and scrap metal dealers.

Mr Reynolds' sentiments were echoed by Duncan Wemyss, the secretary of the Motor Vehicle Dismantlers' Association.

He said that, while the End of Life Vehicles (ELV) Directive meant there was free take-back for all cars recycled through registered treatment facilities, "one can fairly assume we could start seeing an increase in the number of abandoned vehicles".

The problem will come, and its probably there now, if the value we're able to get for the total metals from a vehicle comes down beyond the recovery cost of the work we do

Duncan Wemyss, MVDA
Mr Reynolds explained that the value of the ferrous metals contained within a car had fallen dramatically, from £120 earlier in the year to just £20 now, and added that "we anticipate that by Christmas it'll be zero per tonne".

He claimed that the fall in value could have a "catastrophic" effect on smaller dismantlers' operations, and in particular could jeopardise the contracts some dismantlers had signed with councils to collect and dispose of abandoned vehicles where, due to the high value of metals, they had agreed to pay the council to take them.

"If people have tendered to offer councils a certain amount of money for cars it could backfire," he said. "In particular if they're a one-man band and make all their money by taking cars to be dismantled.

"Some are going to have to go hand and glove back to councils and hand back the contracts."

Mr Reynolds added that, while some contractors would start to charge for collection and disposal of abandoned vehicles, "we're always in a position to be able to take vehicles off councils for zilch," but added that "we can't offer them money for them right now".

Mr Wemyss claimed that the critical point for vehicle recyclers would come when the value of non-ferrous metals and parts within cars also fell.

"The problem will come, and its probably there now, if the value we're able to get for the total metals from a vehicle comes down beyond the recovery cost of the work we do, that's where the fun starts," he said.

"Everybody looks at the ferrous price but we do regain value on catalytic converters and non-ferrous metals," he explained, adding that "its difficult to tell if that level's been breached," he added.

Spare parts
However, Mr Wemyss also explained that economic slowdown's effect on people's willingness to buy new cars could provide a plus point for car dismantlers in terms of spare parts sales.

"There's always the hope that people keep their cars longer and, in that sense, come to our sector for parts rather than buying them new," he said.

Mr Reynolds reported that Redcorn's "progressive" spare parts division was also providing a boost to the company's fortunes.

And, he added that the firm's other operations, such as its work for the DVLA with un-taxed vehicles, was compensating for the downturn in the value of metals from abandoned vehicles.

"If you're working for a council, the money you get back from doing work on fines balances out the cost of collecting abandoned vehicles," he said.

Monday, December 15, 2008

Driving A Trend

When people think of innovative green companies, they may not immediately think of the automotive industry, but auto manufacturers have been designing with end-of-life in mind for decades.

“Cars have been recycled for a very long time,” notes Dan Adsit, manager of vehicle environmental engineering for Ford Motor Company in Dearborn, Mich. “We are very aware of what materials we use and how to bring them back at the end of a vehicle's life.”

Ford has strict requirements for recyclability in vehicle designs that starts at the drawing board and cascades across the development process. From using recycled materials in new vehicles and minimizing the use of restricted substances, to establishing processes and networks to dismantle, sort and repurpose up to 95 percent of any vehicle at the end of life, the auto industry has gotten end-of-life strategies down to a science.

And a big part of its success is industry members' willingness to collaborate with the competition.

“We believe that collaboration is the way to get things done,” says Claudia Duranceau senior research recycling engineer at Ford. “It allows us to be proactive, to work together to phase out materials, and to make sure we don't duplicate our efforts.”
Even in such a competitive market, all of the players in this industry agree that when it comes to end-of-life processes, there is more money to be made working together rather than apart. And the auto manufacturers benefit from being able to reclaim those materials for use in future vehicles.

“When we recycle cars, you can't tell where the material came from,” says Duranceau.

Ford works with the other major automotive players and regulators to help develop networks of dismantlers and to define processes for removing fluids, collecting and redistributing all of valuable materials, and shredding what remains for use as landfill covers to reduce dust and vermin.

Adsit notes that end-of-life dismantling services are privately-owned, not by auto manufacturers, but by independent entrepreneurs. Ford encourages these entrepreneurs and helps get them off the ground in order to build a stronger network and improve the efficiency of the material collection process.

“There is inherent value in any material, but you have to have enough quality in the same place to run an efficient recycling process,” Adsit points out. “In the automotive industry, we all have the same end-of-life issues with our products. When we all get together and pool our resources to deal with those materials, we get the biggest bang for our buck.”

Wednesday, December 03, 2008

China to establish auto recycling policy

In April 2008, Chinese Premier Wen Jiabao visited an automobile recycling facility in Nagoya, Japan, and was surprised when he saw the highly developed industry of automotive recycling which is far ahead of that in China. On July 24, he announced that China will undertake reform of its existing auto recycling industry to build a modern recycling economy in the automotive industry.

In August, the Chinese Commercial Department held a meeting to consider measures for the development of the automobile (end-of-life-vehicle) recycling industry. Participants in the meeting were the National Development and Reform Commissions, Environment Protection Department, Industry and Commerce Department, Tax Office, China National Resources Recycling Association, major carmakers, and waste collection companies. Under this background, the China Nonferrous Metal News interviewed Mr. Jian Min Liu, Chairman of the China National Resources Recycling Association. He analyzed the issues for the existing auto recycling industry as follows:

"One of the barriers for the development of the industry is a lack of management capability on the part of the authorities," he said.

“Under the planned economy in the past in China, ELV recycling has been supervised and managed by two sectors. One is the resources collecting companies and the other is the sales cooperation system under the auspices of the Commercial Department. In the past, resources collecting companies had the right to distribute used steel and nonferrous materials and thus the two sectors have been opposed to each other. That disunity of management was still seen even after the country entered the market-driven economy. At present, the Construction Bureau of the Commercial Department manages the collection of ELVs, while the Environment and Resources Bureau of the Development and Reform Commissions monitors the remanufacture of auto-parts. And the Environment Protection Bureau joins the administrative work for that matter. In addition, the Information and Industrial Department and General Utilization Bureau were newly appointed as the management arms of ELVs. Will the disunity of management help development?"

Moreover, the Construction Bureau of the Commercial Department, which manages the collection of ELVs, is also responsible for the management of the new and used vehicle market. Today, a huge number of vehicles are already used across the country and 4 million ELVs are generated every year. It is necessary to build a strong and unified management to cover such a wide market. In order to develop the automobile recycling industry, we need to resolve the lack of management capability."

--China Nonferrous Metal News October 18 issue

The 1st Asian Automotive Environmental Forum held in Korea

The 1st Asian Automotive Environmental Forum was successfully held in Seoul, Korea, attended by about 15 representatives of carmakers, government organizations responsible for the environment, universities and automobile recyclers in China, Korea and Japan. The international forum ended with fruitful results through in-depth discussions, while it showed greater differences among the three countries, the Daily Automotive News Shinichi Aoyama reported.

Korea to raise recycling rate to 95% in 2015
Korea is currently seeing about 500,000 end-of-life-vehicles (ELVs) annually. That figure is expected to increase to 740,000 units in 2010. Under the automobile recycling law, the Korean authorities will raise the recycling rate from its original target of 85% for 2015 to 95%.

China eyes competitiveness in the global market
China has also been preparing for the launch of its automobile recycling law. Chinese representatives seem to have much interest in how strict automotive regulations which developed countries promote have an impact on the Chinese automotive industry, rather than tackling issues for processing ELVs in China. At present, China is focusing heavily on how to raise the competitiveness of its domestic industry in the world market. This is a similar situation to the move that Japan took in the early 1970s, when Japan made much effort to respond to the U.S. air pollution act so as to secure export business, at the same time it began to see issues for ELV processing at home.

China, Korea watch EU’s move in regard to environmental regulations
Both China and Korea are cautiously focusing on the environmental regulations taken by the EU. Japanese representatives made a report on the framework and current status of the Automobile Recycling Law which was introduced in 2005. The law, which focuses in a limited way on the processing of airbags, Freon gas and shredder dust (ASR), does not represent the standard rule in the world market.

Meanwhile, Japanese recycling technology has been developing. In recent years, many persons from China and Korea have visited Japan to see dismantling facilities and auto-parts recycling firms in Japan.

China questions about Japan and Korea about used car exports
In a panel discussion held on the first day, a Chinese representative asked if Japan and Korea aim to place responsibility for ELV processing on third countries by exporting used vehicles. A Korean representative answered, “It is a difficult issue but we need to resolve it by talking about it together.”

Everyone encounters the Extended Producer Responsibility (EPR) in discussing issues for the environment.
The automotive recycling industry in Asia is coming to the point where they think about auto recycling on a global basis. Amid growing concerns of the environmental conser-
vation in the world, the three countries need to join forces as the center of the Asian market. The next forum is scheduled to take place in Japan in 2009.

--Daily Automotive News November 12, 2008

Monday, December 01, 2008

Setting the Standard: Certification and standards programs will identify vehicle recyclers that consistently act in a responsible manner

The National Scrappage Program, announced in the 2007 budget and slowly coming to fruition, offers the recycling industry an opportunity to define the practices and procedures of a professional auto recycler.

As an element of the scrappage program, Environment Canada wants a Code of Practice to ensure that recyclers participating in the program meet a certain minimum standard.

The national industry association, Automotive Recyclers of Canada, has been instrumental in developing the Code of Practice. Executive director Steve Fletcher says it has been a challenge to develop a national code because most regulation of auto parts recyclers happens at a provincial or even municipal level. As such, the Code of Practice will focus on proper stewardship of waste by-products of the auto recycling process.

The Code will likely contain stipulations for handling and disposal of items such as antifreeze, batteries, fuel, oil, and CFCs. Fletcher also believes the Code will contain suggested best practices and educational material.

"This is an opportunity for the industry to gain something tangible and structural, that will last beyond the scrappage program," he says. "The Code of Practice helps us to quantify what we do."

Too few staff, vehicles
Of more day-to-day concern to the recycling industry is the shortage of available vehicles for parts inventory, and the difficulty of finding qualified employees. "Staffing is an enormous issue out west," says Fletcher. "They can't find enough competent staff."

Access to cars from which recyclers can salvage parts is also difficult right now. "Too much of the vehicle supply is leaking out through unlicensed buyers and the underground economy," he explains. "We try to get vehicles to come through the recycler stream, but...."

With the current high price of steel, recyclers are turning more toward selling scrap metal. "[Scrap] is much more of a business in our industry than it used to be. It's filling in the gap left by decreasing parts sales."

Fletcher is concerned, however, that a sustained drop in the price offered for scrap metal will cause a shakeout in the industry.

At the same time, recyclers are adapting to of selling on the internet., an online resource for finding recycled auto parts, now lists 100 million parts from 3100 recyclers in North America. About half of these body parts are graded with standard ARA part grading.

"We're thrilled that so many recyclers are now including part grading information with the inventory they upload. This will make it easier and faster for their customers to find the parts they need with accurate descriptions and clear information," says Jeff Schroder, president of

Likewise, the Code of Practice will make it easier to find a qualified recycler. However, the federal election could throw a wrench into the development of the Code by slowing down interactions between ARC and Environment Canada. Prior to the election call, the goal was to have the national scrappage program and the Code of Practice operating by Jan. 1, 2009.