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This is off the Knight-Ridder news service. While it's about Ford, if this works out well, I would assume GM would want some of the action too.

It could have both good and bad affects on us. It may be good in that there will be a network in place to better locate parts, but bad in that the cost will probably go up.

Kurt
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Ford set to recycle scrapped vehicles

Automaker will sell junk parts on Internet

April 27, 1999

BY TED EVANOFF
Detroit Free Press AUTOMOTIVE WRITER

Ford Motor Co. intends to buy auto junkyards throughout the nation and dismantle thousands of scrapped autos, selling undamaged parts to mechanics over the Internet and the rest to foundries for recasting into new parts.

The new business venture, as yet unnamed, could produce $1 billion in annual sales revenue within five years, Bill Li, Ford's chief operating officer for the new business, predicted Monday.

Executives briefed reporters on the plan Monday at Ford offices in Dearborn.

In March, Ford purchased its first scrap yard, Copher Brothers Auto Parts in Tampa, Fla., and is negotiating to buy others throughout the nation. Eventually, the business will go worldwide, Li said.

Li stopped short of saying Ford intends to buy a line of repair shops in the United States.

Li said the recycling business could lead Ford to start related businesses such as a remanufacturing venture that repairs and replaces worn parts in components that otherwise would work well.

With the new initiative, Ford would become the first major automaker in the world to develop a sizable recycling business.

Ford is looking to keep its profit margins strong by diversifying within the auto industry.

On April 12, Ford acquired Europe's largest auto repair chain, Kwik-Fit Plc of Edinburgh, Scotland, for $1.6 billion.

If the new venture meets its business goals, Li said, Ford might consider spinning it off as a separate company in a few years.

Ford's new venture isn't expected to lower the cost of used parts but could reduce the time it takes for mechanics, insurance companies and retail customers to find used parts. That process can now take several weeks.

Of the 10,000 auto scrap yards in the nation, many have sites on the Internet, but most serve only their local market and don't have a sophisticated inventory system. Consequently, these yards regularly fill only 10 percent of the orders placed by mechanics, Li said.

By making its list of salvaged auto parts available by computer throughout the nation, Ford expects to shorten the time from order to delivery to days, Li said.

About 11 million vehicles a year are scrapped and 75 percent of the parts are recycled. Ford says its aims to bring the recycle rate up to 90 percent on the vehicles going through its scrap yards.


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Let me the first to say it.....

Here I thought Ford has been selling junk for years.

I'm sorry...I couldn't resist

Anyway, back to the topic at hand

I wonder if they are just going to sell FoMoCo parts or all parts. I think it's great that a large company with some regards to fair business practices and quality would take this on. I would think it would mean a somewhat up to date inventory database, consistant pricing, etc. I would also think, though, that the yards they are buying up are late model yards, and won't effect to old car yards.
 

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What really worries me about this is the definition of 'undamaged parts'. There are many usable parts in the junk yards today that can be refurbished into a usable piece. If someone determines that these parts are damaged and therefore should go to the founder, we have lost a huge resource of old re-buildable parts. Entire cars could disappear. Something like this could make it much more difficult to restore some of the classics that are being restored today. This could really put a dent in our hobby. Just call me 'Chicken Little' (the sky is falling) but I worry about stuff like this.


[This message has been edited by Bob M (edited 04-29-99).]
 

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Y'know, since the 70s Ford did not allow for obsolete part #s to be carried on their computers. As Chevelle enthusiasts we have it easier. I just wonder about the implications, i.e. what Ford determines to be obsolete cannot be carried. The trend for business in the 90s has been to rationalize. I also wonder what it means to the small time specialty junkyard; especially between that and concerns over ground contamination and other ecological concerns. I guess the days when I can collect old junkers, put 'em up on blocks and let the weeds grow around them are drawing to a close.
 

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I am far less trusting of big industry, having worked for some of the "best" (really meaning BAD)such as G.E. - of "we bring good things to life" fame - like nuclear power, weapons, PCBs, and far more.
Profit is the only motive in industry - actually the reason they exist.
I expect they will recycle a few select parts which are as good as new and sell for top dollar and melt the rest. Why??Volume sales are the way they make money, not a few old parts here and there.Also, Car prices have skyrocketed, thus causing more people to hold on to older cars (all year models, all types)
How to stop this phenomenon ??Get rid of repair parts. The large manufacturers have already cut back on parts availability for older models, and most new models are not user or shadetree servicable.
If they crush and melt down the used parts, more people will need to buy new cars - thus more sales - thus more profit.
Do you really think there is enough money in used parts for The big 3 to mess with them ??? Think again.

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283; I've said this before, I like the way you think. Hit the nail right on the head. All publicity aside, this is a dangerous trend, in my opinion. tom
 

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I myself am fairly new to the whole classic car world, but in the few years i've been interested, even I have noticed that it's going to get harder and harder to do what we all love.
If only Chevy cared a little bit more about its old customers as well as its new ones.
i don't give a crap about Ford personally, but if they really plan to do what they say (and if it includes parts for our cars too) there has to be something done to stop them from ruining the past.
 

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I doubt Ford is looking at 'recycling' classic (old) parts. I would bet that they are focusing on much newer stuff (90's - maybe late 80's) as there would be a much bigger, more profitable market.
 

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Thats right on, I saw this story about this on the tube just recently. Every indication it was the newer cars and trucks. Thats where the big $$$$$$$$ are. Almost of the big salvage yards don't keep the cars forever, once the profit is gone, the crusher is next. One yard operator told me sometime ago we are a big pain, he said you guys come here wanting to roam the yard, pick anything you want and then waste my time arguing over the price, I got rid of that old junk. They are starting to regulate the auto salvage business like everything else.
 

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Lets get real here.

There are thousands of junk yards in the world, most have a grizzled old owner and a mangy dog running it. The parts inventory is in the guy's (and the dog's) head.

These little places don't even pop up on Ford's radar. It's the big, organized recycler that appeals to Ford (and others).

They could care less about our old Chevelles and muscle cars. They want to do to two things:

Tap into the lucrative parts later-model auto recycling business.

Assure that the old cars don't stay on the road too long sa that new cars sales profits aren't hurt.

Simply put, people like us are just a pimple on Ford's (or GM's) posterior.



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ddoler is on the money.i went to a fairly big junkyard today to see about a conversion that i'm in the process of doing and the guy told me that this is a modern salavage yard and we do not have any of that old stuff.well i asked how old is old stuff he said mid 80's is old and every year its bumped up.i know it sucks having the biggest yard in the area dealing with profit instead of ones personnal needs,but thats where the big money is for them and thats how they will continue to operate.i know there are big old car junkyards out there,but i think the need for ford to purchase them would be a waste of their time.only,because money is in collision and modern components.not recycled steel!
 

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I must confess, I am terrified of all the schemes the government and the big 3 auto builders are resorting to. I have 2 Chevelles and I have to wonder how far they are going to go to actually force us to give up these type of vehicles. I will build a basement and put them down there before they have the chance to confiscate my cars (as they try to pry the keys from my cold, dead hands........he he) I'm glad that there are aftermarket manufacturers out there who realize that there is still a market for what we do. Now how long will it be before the Big 3 (and Big Brother) buy out these aftermarket manufacturers and dissolve them totally?

Johnny

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The USA is a free country and it doesn't sound like Ford is proposing anything illegal with their plan.

I think it will have zero affect on yards that sell parts for cars 25+ years old. In the big picture, guys like you and me who are into old cars don't generate enough revenue to attract the interest of Ford or GM. If the Big 3 really wanted to make money off of us, they'd get into reproducing all kinds of parts for our old cars. Because they aren't even doing that, I doubt that they will go after old car parts yards.

Moreover, the old car parts yard offer a very limited source of income. Once the parts are gone, so are the profits. "New car" parts yards, however, will continue to provide income indefinately. If you were to invest millions in an old car salvage yard or in a new car salvage yard, which would you choose? I think we collectively have nothing to worry about.

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Robert

www.classiccarlot.com (15% discount for my fellow Chevelle owners!)
 

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I have many salvage yards as my customers. They buy terminals and printers for their computer systems and we repair the same for them. Many are family businesses, some second generation. Recently a retiring owner helped a young friend of mine become an entrepreneur by financing the business for him. He's doing great, the American dream lives on!

We shouldn't be suprised to see a large company interested in auto salvage. I was amazed to learn one of my customers in a town of less than a million did over 3 mil a year. This volume is made possible by software written by Hollander, a company founded by Roy Hollander during the depression. Great time to start a business. Bet the banks were tripping over each other to loan him money. Or were they closed? Be sure to check their web site, www.hollander.auto.parts.com. Interesting history and good lilnks.

Hollander's business was purchased by ADP, 34,000 employees, 4.7 billlion revenue. My companys sales would be a rounding error on their tax return. The software enables the yards to post their inventory on a central computer for other yards to see. By using digital camera yard A can show yard B a front clip via the internet and they can agree on condition and price. The technology is in place for a major player to employ the efficiency of consolidation.

We only have to look at other industries, banking, new auto parts, hardware and grocery to see where this industry is headed. Sadly, many businessmen will take early retirement, their children deprived of the opportunity to carry on the family business. The lucky ones will sell, others will be forced to close.

Next tme you drive past the small businessman on your way to a mass merchandiser, remember the American dream, make a U turn!
 
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