Imagine a scrap yard having to turn away your vehicle because they have too many cars to crush. Does this sound ridiculous? Well, with the success of the Cars for Clunkers program, wrecking yards across the country are seeing more business than ever.
Despite the criticism leading up to the Cars for Clunkers program, car buyers have been flocking to trade in their clunkers for new, more fuel-efficient cars. The spark of demand for cars has left many auto dealerships scrambling to find more inventory to sell, providing a nice boost of badly needed business. The program has also benefited two unexpected industries: tow truck companies and scrap yards. So what happens to a “clunker” after it is traded in?
All of the “clunkers” traded in through the cars for clunkers program must be dismantled and sold to salvage yards within six months. Because of this, many towing companies and scrap yards are crushing cars that are “nicer” than the typical car they are used to compounding.
Under the law, the engine of each “clunker” must be permanently disabled and the drive train cannot be sold without being disassembled. These two parts usually account for 60% of the profits made from a recycled vehicle.
By destroying the engine and drive train of these vehicles, companies are making less on each vehicle’s recycled parts and there are fewer components that can be used to repair existing cars.
Once the engine and drive train are removed, everything else in the car (including the tires, mirrors, windshield, etc.) can be resold for profit. After any re-saleable parts are removed, the car is crushed or sometimes taken to steel mills where the scrap metal is recycled and used for other purposes.
Did you take advantage of the Cars for Clunkers program? What kind of car did you trade in?
Comments on this entry are closed.