The export of damaged vehicles and the ever-increasing complexity of new vehicles could lead to a shortage of used parts, which will ultimately lead to a rise in prices, a Quebec recycler fears.
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Éric Pellerin from the company Recyclage Pellerin has already pointed to the ever-increasing number of parts and their increasing complexity to explain why it can be difficult – or sometimes impossible – to find the part necessary for a repair (see other text) .
But another factor comes into play: foreign appetite for damaged cars from Quebec.
Based on his experience, Mr. Pellerin estimates that 20 to 30 percent of damaged vehicles sold at auction – which he sees as an important source of new parts – are exported, mainly to the Middle East.
“I myself, a small recycler in Plessisville, sell 600 to 800 vehicles a year to exporters,” reveals Mr. Pellerin.
Modus operandi
An exporter first presents Mr. Pellerin with the vehicles he is interested in at an auction and agrees a purchase price with him. Some auctions even offer these exporters the opportunity to buy directly.
The transaction is quick and interesting for the recycler. “And if I don’t sell it to him, it will be someone else,” he admits.
“It increases the price of the cars at auction and the rarity will also increase the price of the parts,” notes Mr. Pellerin.
No more work
And as car prices rise, recyclers must put more effort into properly valuing the vehicles.
Éric Pellerin, head of the Recyclage Pellerin company in Plessisville in his office. Provided by Recyclage Pellerin
“Before I could spend 5 to 8 hours a week at the auction. Nowadays it takes more than 20 to 25 hours per week to buy the same amount. A vehicle that cost $800 to $1,000 is now selling for $2,000 to $2,500. “We must not make mistakes, the error rate must be reduced, otherwise the company is in danger,” he emphasizes.
George Iny of the Automobile Association (APA) was unaware of the phenomenon of exporting damaged cars. However, he points out that “the availability of used parts has been improved by vehicle thefts in the past.”
But as the Journal's investigative bureau revealed in October, thousands of stolen vehicles are now being exported, particularly to Africa. They can also no longer supply the user parts market.
“We want the government to help us. A tax would be necessary for this, believes Éric Pellerin. Exporters set up shop in Canada, collect their taxes, load the vehicles into containers and ship them. It would take something to counteract that.”
Win-win situation
But trade with exporters doesn’t just have negative effects for recyclers.
“I have another buyer who is buying the assembled mechanics, engine and gearbox from me. I sell them every day. It also goes to the Middle East. Here we often dispose of a vehicle due to corrosion. There the opposite is the case, they have no corrosion, but the sand is hard on the mechanics. That's good, because otherwise we would throw away 9 out of 10 mechanics. There is not enough demand in Quebec. There are good and bad things when it comes to exporting,” says Éric Pellerin.