16/01/2015 – China may see first ‘car scrappage peak’ in 2015


New York, New York — January 12, 2015 — Automotive recycling in China lags behind many developed countries, but that may be about to change. China’s automobile industry has ushered in an explosive growth since 2000, with car ownership rising to 137 million by 2013, second only to the US. According to an estimated average car scrappage deadline of 10 to 15 years, China will see the first car scrappage peak in 2015.

China’s overall automobile scrap rate was only 4 percent in 2013, far lower than the 6 to 8 percent developed countries, mainly because national policies on motor vehicle liquidation are still unclear and the industry still desires to be regulated. At the same time, China’s low capacity to formally dismantle and process end-of-life vehicles (ELVs) is far behind the needs.

Based on China’s car ownership and its growth rate, and 6 to 8 percent ELVs of car ownership in mature markets, China’s ELVs will reach 9 to 12 million by 2015 and 12 to 16 million by 2020, showing a great amount of scrap.

Every professional auto recycler knows that there is a great quantity of valuable resources in ELVs, a large number of parts among them can be recycled through remanufacturing. However, even if only scrap steel, scrap tire, waste plastics and scrap non-ferrous metal content in ELVs are considered in statistical analysis, its industry scale will reach about $34.26 billion CAD in 2015; if parts remanufacturing and related equipment needs are included, the figure will be far above $38.54 billion CAD

In 2013 a total of 576 Chinese enterprises obtained auto dismantling and recycling qualification, up 10.34 percent year on year; 2,268 auto recycling outlets, up 1.39 percent year on year. ELV recycling and dismantling network is taking shape in China, but related enterprises are generally featured by small production scale, low recycling amount, and scattered resources. Shanghai Xinzhuang Auto Dismantling, for example, is China’s largest automobile dismantling company, but its annual processing capacity is merely 25,000 vehicles.


Source – CollisionRepairmag.com