ARA 2023 Industry Report

Mar 1, 2023 | Industry

By Sandy Blalock • ARA Executive Director

One of the cornerstones of ARA’s work as an Association has been advocacy.

Professional automotive recyclers around the world have worked hard over the past three years to recover from the global pandemic. As a result, we find our industry and the recycled auto parts market have fundamentally changed and ARA is working hard to take advantage of all opportunities to promote Recycled Original Equipment (ROE®) parts.

First and foremost, our membership has changed. There has been unprecedented consolidation within the automotive recycling industry lately. Many familiar family-owned businesses are now important players in ever-expanding operations with multi-state partners and corporate owners. There are mixed feelings about this and that probably will always be the case. ARA is cognizant of the changes and is working to make sure that our package of member benefits suits both our smaller and independent family businesses, as well as growing multi-site operations.

Another trend we have seen within our membership ranks is that several of ARA’s newest members are start-ups, brand new to the recycled parts market. These new businesses have taken a keen interest in the ARA Peer Mentoring Program, learning from their peers to lay the groundwork for success. We want to ensure that new members also start on the right foot by enrolling in the Certified Automotive Recycler (CAR) Program. A brand-new endorsement this year by eBay Motors requires that anyone selling airbags or airbag-related components on the eBay platform to be CAR certified with a recall procedure in place. We are very proud of this endorsement by eBay and are actively pursuing endorsements of the CAR Program by other players in the automotive parts market – stay tuned! And if not already enrolled in the CAR Program, doing so has never been easier. Find out more at www.aracertification.com.

ARA members are facing continued outside pressure for inventory from global buyers with bigger budgets. I personally suspect that approximately 30 percent of the salvaged vehicles sold at auctions are purchased by international buyers, another 30 percent by rebuilders, leaving one-third of that customer base our industry. ARA is acutely aware that the increased fees paid by its members at the auctions paired with competition from companies pushing prices higher is making things more challenging for businesses to survive. As an Association, we know that this is an extremely big concern. Copart and IAA are supportive of the automotive recycling industry and are associate members of the ARA. We need to sit down and see if there is some kind of consideration that could be given to the true licensed professional auto recyclers that are buying cars from them.

2023 is off to a busy start! Early on, ARA’s Executive Committee along with several Association staff members attended NAATBatt 2023, the annual meeting and conference of NAATBatt International. NAATBatt International is a not-for-profit trade association of companies, associations and research institutions commercializing advanced electrochemical energy storage technology for emerging, high-tech applications. This year’s conference addressed some of the most significant issues and challenges that the industry faces, including the recycling and reuse of batteries, battery traceability, cradle-to-grave tracking and tracing, and policy changes that will impact the industry.

ARA at NAATBatt

ARA is actively part of conversations happening on ways to collect, manage, reuse, and recycle lithium batteries. Traceability needs to be able to promote reutilization. We need to be able to put these batteries back into the best marketplace so as to limit/reduce mining and promote maximum battery lifecycle. We expect many companies specializing in the battery market to attend ARA’s 80th Annual Convention this October, along with the latest information for automotive recyclers in our educational sessions. So make sure to register and attend! (Visit a-r-a.org/convention).

One of the cornerstones of ARA’s work as an Association has been advocacy. In addition to the extensive work ARA has done concerning electric vehicles, ARA has played a key role in helping to combat catalytic converter theft. Over the last two years, ARA has tracked approximately 180 pieces of legislation across 38 states and taken an active role in developing effective catalytic converter anti-theft bills. This pace has not slowed down in 2023. Staff work regularly with regulators, stakeholders within the broader mobility ecosystem, and law enforcement organizations. Along with helping to strengthen state scrap acquisition laws, ARA has exposed a dramatic need for vehicle owners to be able to purchase Environmental Protection Agency (EPA) Compliant Used Original Equipment Manufacturer (OEM) Catalytic Converters from automotive recyclers.

ARA currently sits on the International Association of Auto Theft Investigators’ Subcommittee on Catalytic Converter Theft. While serving on this subcommittee, which comprises members of law enforcement, OEMs, prosecutors, new car dealers, and the Environmental Protection Agency, ARA has been able to lend its expertise to the drafting of six policy points for effective catalytic converter anti-theft legislation. These six points have served as the model for many of the state catalytic converter anti-theft bills written over the last two years. ARA stands committed to working alongside law enforcement to help prevent catalytic converter theft. ARA is also working on the safe handling and dismantling of electric vehicles, vehicle data access, stormwater permitting, tire recycling, e-titling, fire prevention, and metal shredder aggregate regulations.

ARA Recycler Tour

ARA is busy strengthening relationships with other players in the automotive repair market. The Association has, for many years worked closely with the Collision Industry Electronic Commerce Association (CIECA). Many years ago, ARA leadership understood the value of assuring Recycled Original Equipment (ROE®) auto parts were understood and clearly identifiable as a choice for quality repairs in the collision and mechanical industry. CIECA Standards are developed to provide software developers with a full set of tools necessary to develop APIs tailored to the needs of the collision industry. We have worked with CIECA on the establishment of the Recycled Parts committee, as well as a few newer committees like the OEM Procedures, Artificial Intelligence, Electric Vehicle, and Education committees.

Members of ARA staff and leadership have actively been involved with several committees of the Collision Industry Conference (CIC) and have had the opportunity to present our industry’s view and concerns during some of these quarterly meetings. CIC is a forum made up of participants from all industry segments for the expressed purpose of discussing and exploring the issues that occur among them. Through discussion and research during meetings and extensive interim committee work, CIC attempts to form a consensus on various issues, aware that all such findings are nonbinding and voluntarily accepted. ARA is an active member on several of the committees.

The meetings are open to all interested individuals of all segments of the industry to include repairers, insurers, paint, parts and material companies, equipment, vehicle manufacturers, data providers, representatives of trade associations, anyone with an interest in creating a more professional industry. Each agenda has time set aside for participants to publicly address their concerns that are not on the published agenda through the time set aside as “open microphone.”

The outlook for automotive recycling is exciting and daunting at the same time. Vehicle technology, EV batteries and new vehicle materials continue be ones to watch, among the other initiatives mentioned in this report. Auto recyclers looking to advance their business should be adopting best practices and standard operating procedures now to ensure their team is ready for whatever may come in the future. In the meantime, you should rest assured that your volunteer leadership and staff are keeping tabs on immediate needs for the industry, while looking for opportunities to expand the business of automotive recycling in the future.

Reach Sandy Blalock at sandy@a-r-a.org. Share your thoughts pertaining to the advancement of professional automotive recycling. Your letter could be published in an upcoming issue.

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