The biggest issue facing legitimate auto recycling businesses is the impact of unlicensed, unregulated operators.
There are many unprofessional, non-compliant “back-yarder” operators who use flashy websites and paid Google adverts to attract unwary consumers to deal with them. They make it look like they are credible auto recyclers – but they are not.
These operators deliberately flout Laws & Regulations, particularly Environmental, Safety, Taxation and Licensing Laws. Many deliberately operate “out of the public eye” from unsigned high fenced properties so they avoid scrutiny of their operations.
By not complying with the above Laws, they operate at low cost and are able to direct more capital into the purchase & export of vehicles, inflating the true price of salvage such that it becomes uneconomic for legitimate Recyclers to compete.
ARAA has been in consultation with our Certified Member Network discussing ways to combat this growing issue. There is no single “quick fix”, but we believe we have a range of strategies that will have an impact over time. These include:
- Promoting the Australian Certified Automotive Recycler (A-CAR) program to professional recyclers to support them in differentiating their business from these back-yarder operators;
- Focusing on environmental compliance and working with State EPAs to support businesses who are environmentally compliant;
- Introducing a Scrap Car buying program that is made up of Certified businesses and promoting to the community the benefits of dealing with professional Certified recyclers;
- Working with the National Motor Vehicle Theft Reduction and Victoria Police (and hopefully New South Wales Police) in identifying loopholes in Licencing compliance and Export arrangements that are being exploited by rogue operators.
We appreciate the support from our Certified member network for these initiatives and will maintain close contact with all members as these programs develop.