People are flocking to dealerships to trade in their vehicles under the “Cash for Clunkers” program, but once the trade is made, dealers and salvage yards are required to remove the car from the road for good, but how? First up, under the program, the dealer seizes up the engine with sodium silicate–a job usually handled by the dismantlers, but now the salvage yards are earning a lot less because the engine is now useless scrap metal. Joe Pattison of Can-Am Auto Salvage in Ontario, CA says an engine, which can bring in between $250-$1500, is like “a pearl in an oyster.”
After disabling the engine the car is then towed to the salvage yard where it is evaluated for profit potential, and liquids like gasoline and anti-freeze are drained. According to Pattison, a vehicle like an old, flawed work truck would be crushed sooner than a car with usable front end parts and transmission; a catalytic converter which could yield $100; good tires worth $100, and metal that could earn the yard up to $150. Those parts are then cut out, as is the car’s computerized “brain”.
The vehicle is then placed on stands where the parts are entered into a database, and set up for sale online. The rest is crushed. According to Pattison, some vehicles yield 4-5 parts, while others yield 7-8. This process may not sound sexy, but this is serious business.
Pattison has to follow strict laws that prevent any person or entity, other than dealers and dismantlers, to take possession of the vehicles. He even has to sign an affidavit for each car that comes in. And while the dismantling process has a beginning, middle and end, Pattison believes that the ultimate economic impact is unknown. “I’m excited, yet apprehensive. But I also wonder if this whole thing is like a teenager who gets their first credit card and runs it up, and their co-dependent parent pays it off for them, and then the whole process starts all over again.” He also worries that an influx of parts could flood the market, affecting profits. And his isn’t the only opinion on the program’s possible impact.
There are the haters: “LOL at destroying old, working cars and getting people into more debt to buy new ones. Great plan. There should be a program where you take your…wardrobe into Banana Republic to be destroyed, and get a gift card.” (Anonymous online comment)
There are the suspicious: “Could it be any more…frightening? Here you are trying to be a good citizen…and guess what, they are jumping right inside you, seizing all of your personal…information and it’s absolutely legal.” (Glen Beck on language from the Government’s “Cash For Clunkers” website that he found invasive)
And there are the lovers like Leo Hagen, Sales Manager of Hollywood Ford. “It’s working good, and it’s bringing in other business too. The Focus in California is booming, which is surprising. People’s perceptions are changing. Of course, if the owners don’t qualify that’s when people get their hopes dashed.”
With all of these differing opinions, it looks like Hagen was right when he told me, “The program stirs the pot.”