By Nick Daurio
There is a lot of change occurring in all facets of this industry, and it doesn’t matter what you do, we are feeling the pressure. Faster than some realize, one change is in the current marketplace – whether it’s commodities for the scrap recyclers, the u-pull-it segment, or demand for our ROE parts. This has occurred as we are in the final stages of market adjustments from the supply chain issues during COVID. Almost now fully functional, some of us are experiencing a slowdown in sales.
This isn’t the first time this has happened, nor will it be the last. During these times, it is good to really pay attention to pricing – not only for parts inventory, but more importantly for vehicles. Buyers at auction must pay attention to supply and demand, and what parts are selling, and what are not, and purchase accordingly. The market has slowed down in certain regions like mine, but not all. Yet we all need to be aware of market trends on both sides, purchasing and sales.
Certification plays a role in the new marketplace. As a professional audit year for all ARA Certified Automotive Recyclers (CAR), it is important that CAR recyclers keep up with their required documentation. This program is valuable to our entire industry; it levels-up our image and profile to our parts partners – from collision to mechanical repairers, and even in recycler-to-recycler sales. When expectations are met with excellence from a CAR recycler, it raises the industry. Furthermore, credibility is an advantageous benefit from ARA membership in down economic times, as is being a CAR member.
Every ARA member counts – we are only as strong as we are in numbers. We all need a team around us, not only within your facility, but also networking with fellow recyclers. This camaraderie is the most enjoyed benefit of ARA membership. Because of this, I have confidence that our industry is resilient and will adapt in coming years, together.
Our roots as an industry run deep. I have respect for our past presidents and board members. Many are still very involved in our industry whether they’re still working or not. They remain accessible and supportive, and it is amazing. I don’t know of too many industries where the forefathers who brought us to this point are still concerned about the future success of their industry.
Many of these mentors were the leaders of current successful generational businesses. They are all survivors of change, they were not afraid to look outside the box, and should be looked to as role models.
The industry is moving forward, fast, and there are many unknowns to be worked out. For now, there is slowdown in electric and hybrid vehicle sales for the last six to eight months. The trade-in value of these vehicles is questionable due to battery health. That factor also makes buying inventory from the auctions tricky. We used to buy used cars or merchandise based on miles. Now, knowing the state of electric vehicle battery health is essential going forward in the overall automotive marketplace. As we migrate into tomorrow, however long it will take, testing equipment for electric vehicles is going to be critical for our industry and that’s where certification really is going to play even a bigger role.
Certification does not make an overnight success story and it takes time to cross all the T’s and dot all the I’s. Recyclers who are not certified need to be so as soon as they possibly can. Don’t be afraid or say you don’t have the time, because the time is now as we head into more advanced vehicles, including alternative fuel cell type of vehicles. Certification is next-level readiness; it is an investment in your future.
We must understand the environmental and economical highest and best use of repurposing or reusing EV batteries; and then recycling it when the battery is scrap. More and more technology will help, and it is critical for the modern professional auto recycler to be ready to adapt to this era to succeed. For so many years, the engine, transmission, and powertrain parts were a big part of our return on our investment, and now we have new opportunities coming.
Progressive leaders who adapt, starting now, will reap the rewards of the future marketplace.
There are two industry professionals that I’d like to acknowledge for their impact, especially on ARA. The first is Sandy Blalock. At this year’s 81st Annual Convention & Expo, we honor Sandy as she vacates the role of ARA Executive Director to pursue other industry endeavors. Her dedication as a mentor, leader and advocate has been nothing short of extraordinary. I’d also like to give sincere and deserved appreciation to Kim Glasscock, ARA’s Event Planner for 18 years, who is also leaving ARA. She has done a phenomenal job creating magic at our meetings and conventions. It has been a pleasure to work with her.
Lastly, attend the ARA 81st Annual Convention & Expo in Reno, October 23-26. The environment will be exciting, with a chance for a select lucky group to tour the Tesla Plant (details on page 31). The networking, speakers and educational sessions will bring a lot of energy; plus Reno is typically fabulous in the fall, so I encourage people to attend. Sign up today – don’t gamble with your future!
