Car Materials

Part
01
of two
Part
01

In China, what happens to car materials after the car reaches the end of its life?

Hello! Thank you for using Wonder to ask about what happens to car materials in China when a car reaches its life expectancy.

After searching online through many trusted sources, we could not find a substantial amount of information in regards to your question. This is mainly because a lot of the reports were from websites where you would have to pay to see the information. However, we have found a substantial amount of information regarding China and how they do not utilize their ELV (end-of-life vehicle) market to its full potential. In addition to those findings, we have found significant information on the future of car disposal in China.

The short answer to your question is that when a car needs to be disposed of, they are sent to recycling facilities where they are registered into the ELV, the car is then inspected to see if it is friendly to the environment. After inspection, workers remove reused and remanufactured parts, which includes dismantling the interior and exterior components, including the engine and gearbox. After the interior and exterior are taken care of, the plant workers then dismantle, cut and classify the end-of-life vehicle. The last step in the process is a heat cleaning treatment that is given to all the remanufactured cores. You will find a detailed report of our findings below.

METHODOLOGY
After searching exhaustively through academic databases, government reports and databases, industry reports, trusted media sites, regulatory filings, user forums and review sites, we have not found a substantial amount of information on your question. This is partly due to the fact that the majority of reports online were hidden behind paywalls. However, we did find information that would prove useful to you about how China does not utilize their ELV market to its full potential and the future of vehicle recycling in China. This report will be separated into two sections. The first section being on the ELV market and how it should be used. The second section is describing the future of the car recycling market in China. You will find a deep dive of our findings below.

ELV MARKET INFORMATION
According to Recycling International, the number of ELVs in China is expected to reach 12-16 million cars by the year 2020. In recent studies, the value of steel scrap, tire, plastic, and non-ferrous metals will estimate out to almost 178 billion Yuan, or $26,157,629,229 in 2015 (since the amount was only given in Euros, I used XE to calculate the amount in U.S. dollars). Report Linker tells us that in 2013, 576 Chinese enterprises signed up for vehicle dismantling and recycling. This increases about 10.34% a year. In total, there are 2,268 vehicle recycling facilities which increase about 1.39% a year.

This article also states that China lacks regulations and adequate space to dismantle these vehicles properly. This is because a majority of the enterprises have a small production scale, low recycling numbers, and scattered resources. The recycling market is still growing rapidly despite lacking regulation and space requirements and is also home to the nation′s biggest car dismantling plant, Shanghai Xinzhuang Auto Dismantling. This recycling plant processes about 25,000 vehicles a year. Another major problem with the ELV market is that the majority of cars are purchased and sold on the black market. This PDF by the Journal of Cleaner Production states that this is an issue because a majority of vehicles are refurbished and then delivered to rural areas as pre-owned vehicles; which lowers the recycling rate for ELVs and their components and these vehicles are not safe or environmentally approved.

This next PDF describes the current methods used with ELVs and the recycling market (I used this source in your short answer in my introduction paragraph for the method used to recycle vehicles). This article is quite useful because it shows charts to further stress the goals of automobile recycling in China and describes their projected numbers and data into the year 2020. In short, the goals for recycling plants are to fully establish a system under a controlled producer, make ELV's recycling rate to go up to 95%, achieve full management and control all the legally banned and restricted fluids, and distribute used parts by utilizing recycling technology by 2020.

This article by Daily Mail Online highlights how many cars are available to scrap in China. I found this article interesting because it provides aerial views of a recycling plant in Hangzhou. This article states that about 5.5 million vehicles will be scrapped this year because they are high emission which will provide $122,416,683,766 to China's recycling industry. Experts are projecting that 16 million vehicles will be in these recycling yards. As a result of all the cars being scrapped, China was flooding the steel market and sending it into chaos. This was halted when the United States had to impose a 500% tariff on steel from China.


THE FUTURE OF CAR RECYCLING IN CHINA
Recycling Today has an informative article about how China's recycling practices can be influenced greatly by the processes that Japan uses. At the 2016 World Recycling Forum: Electronics and Cars Recycling, the Chinese government assigned China Automotive Technology and Research Center or CATARC, to establish an extended producer responsibility, or EPR, program for cars. A major part of the project requires car manufacturers to create a dismantling manual and describe the best processes to disassemble certain vehicle models.

Toyota Tsusho is a Japanese company that has decided to lend a hand in China by launching a vehicle dismantling and recycling plant. The goal of the project is to utilize their technologies over the past 40 years to help combat environmental issues in China. This article has a very informative flow chart to show the process of vehicle dismantling that Toyota Tsusho uses. The long-term goal of this company is to open and establish 20 more recycling plants in China to promote safety, productivity, and environmental awareness.

In October of 2015, China National Resources Recycling Association (CRRARD) visited Phoenix, Arizona to take a tour of Phoenix Automotive Cores. An estimated 32 representatives were in attendance and this tour was to promote China's new and improved vehicle recycling and re-manufacturing industry and to provide information on practices that fulfill vehicle recycling and vehicle part refurbishing. During the tour, the representatives got to take a look at how cores are received, inventoried and processed for refurbished purposes.

CONCLUSION
After searching many credible websites and sources, we could not find a significant amount of information regarding your question. This was because a lot of the reports were previews and you had to pay for the full report information. However, we believe that we did find a significant amount of information on the end-of-life vehicle market and future of car recycling in China. After we gathered enough sources for this report, we found the answer to your question and then elaborated further on the topic to the best of our ability.

Thank you for using Wonder! Please let us know if we can help with any additional research!
Part
02
of two
Part
02

In China, which organisations are involved in disposing or recovering the different parts of cars and their materials after the car reaches the end of its life and where does such material go (such as recycled, landfill, burned, etc.)?

Hello, and thanks for your question about Chinese vehicles and how they are disposed of at the end of their lives. To put it quickly, the major players in the auto-recycling industry in China include licensed dismantling companies, equipment sellers, and precious metal and auto-material recovery companies. However, there are relatively limited numbers of dismantlers in comparison to other countries, so many of the vehicles that are eligible for recycling remain in landfills as of right now. Below you will find a deep dive of my findings.

METHODOLOGY

For this request, we researched through academic databases and journals, as well as company websites and business reports. The two most significant sources were from Bizjournals, and Recycling Today, where significant figures and trends from the industry were found. We attempted to find out exactly where vehicles are at the end of their lives, and how frequently they are recycled. Following that, we tried to ascertain which companies in which particular industries are responsible for dealing with all of the associated materials during and immediately following the recycling process. Ultimately, we found that the industry contains four primary players including the Chinese government, licensed dismantling companies, scrap equipment companies, and precious metal/recycled materials dealers. Within our research, we were able to find a series of figures that truly indicate the scope of the recycling/auto-scrap industry, with reports from 2015 indicating that there may be nearly $20 Billion in total market impact related to Chinese auto-scrap.

GOVERNMENT DIRECTIVE

The Chinese government plays arguably the largest role in the disposal and recovering of ELV's. In an attempt to curb pollution, only 90,000 registrations will be made available to non-eco friendly cars in China by 2017. These types of measures are responsible for the thousands of vehicles pouring into scrap yards presently, as seen in a scrap yard in the city of Hangzhou where over 100,000 vehicles are now laid to rest in preparation for recycle. As well, a Chinese government directive in 2016 sought to divert 80% of all ELV materials from landfills, with 75% of diverted ELV materials capably recycled.

DISMANTLING ORGANIZATIONS/COMPANIES

As of the writing of this brief, the Chinese scrap market and total volume is greatly increasing, with cars eligible for scrap and recycle expected to climb to 16 million by the year 2020. China's scrap rates are low for a developed country, which is a symptom of the small and disorganized effort of the Chinese government to support the effort. As of 2016, for example, there were only 603 licensed salvage shops in China, as opposed to the over 10,000 salvage shops in the U.S. Of these organizations, the largest industry player is Shanghai Xinzhuang Auto Dismantling, which is only capable of processing around 25,000 vehicles per year.

EQUIPMENT SELLERS

Another large portion of the ELV market is the distribution and sale of the equipment necessary to properly recycle a vehicle eligible for recycle. These machines include scrap metal balers, shears, scrap metal shredders, waste automobile dismantling equipment, non-metal balers, and compressors. The largest transparent player in the fray for these types of equipment sales is
Jiangsu Huahong Technology Stock Co., Ltd. These types of equipment are responsible for rendering down the materials to be used for resale by licensed dismantling shops. Many of the products produced by equipment sellers are in use through recycling efforts and have been featured on many government projects in the China, including national circular economy parks, national urban renewable resource bases, steel and nonferrous metal enterprises, waste steel processing centers, and household garbage processing centers.

PRECIOUS METAL/MATERIAL RECOVERY ORGANIZATIONS

After the materials have been properly rendered through the use of correct recycling methods and proper equipment, recycling efforts by larger companies in the buying and selling of metals and other materials are featured heavily in the Chinese marketplace. An expected rise in scrap rates of 17% also means domestic recycling enterprises will continue to increase the scope and demand for automobile scrap by large companies like Shenzen GEM. A major player in the cobalt and nickel industries and a Square-A traded company on the Shenzen stock exchange, Shenzen GEM is presently a member of the Chinese National Recycling Economy Demonstration Pilot program, responsible for recycling and reallocating resources from recycled vehicle batteries.

CONCLUSION

To wrap it all up, Chinese vehicles that are at the end of their lives are presently either in landfills or recycled. The four major players in the process of seeing a car at the end of its life all the way to its recycled parts are the Chinese government, dismantling and salvage shops, equipment sellers, and precious metal/material recovery companies. Thank you for using Wonder. Please let us know if we can help with anything else!





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