By Caryn Smith
Industry gatherings are commonly known for their sessions and celebrations, networking and notable keynotes – the balanced recipe for a perfect event. The Automotive Recyclers Association Annual Convention & Expo is no different.
Yet, two years ago, just when it was needed as a way to bring the issues to the table and to obtain insights from the membership, the “Recycler’s Roundtable” was born. As the Association desired more interaction from the membership on key issues, this braintrust of the industry was a highlight of the event. So much so that it was brought back again for a second year as the 2nd Recycler’s Roundtable kicked off the 74th Annual Convention & Expo – held in Dallas, Texas in early November 2017 – with a force.
The intangible, yet evident, result of these pivotal sessions from the last two conventions was membership-wide unification and bonding.
In Dallas, the room was packed with hundreds of attendees completely filling a huge ballroom. The two moderators, Shannon Nordstorm, CAR Committee Chair and owner of Nordstrom’s Automotive, Inc., and Scott Robertson, ARA’s new Executive Secretary and President of Robertson’s Auto Salvage, Inc., fielded the auto recycler’s comments and provided guiding insight for the tough topics of discussion such as OEM position statements, data, safety, global issues, marketing and more.
The mood was serious as opinions were shared. Heads nodding and hands raising throughout the ballroom. Many heads were down in concentration, jotting notes, while others listened intently to the discussion. Soft whispers to a neighbor were evident as topics spurred side-discussions.
One rather lengthy dialogue centered around OEM position statements that often contain language to consumers that warn against the use of recycled auto parts in repairs. Several statements of real concern were reviewed and concerning to the recyclers. The general conclusion was summed up that “without all auto recyclers involved, there will be no real progress in our efforts to change this,” says Sandy Blalock, industry advocate.
Another topic of concern was that the consumer has no real control over the data in the cars they own, and they don’t even realize that it limits their real options. The feeling was that empowering consumers to understand why they need access to their own car data could move the needle to unlock data to everyone, including recyclers, both in getting the OEM build sheet data, and the recyclers own data as a resource for selling parts. The concept that recyclers should share data more with each other was also mentioned in order to get metrics for other recyclers and to help them in their businesses.
The bottom line consensus was: OEMs likely won’t share information, and we need to come up with ways to get at that data as it won’t be just given to the industry. “We have to study, educate ourselves, compete, follow technology, study the market,” commented one attendee.
“We gotta compete,” noted Nordstrom.
On Capitol Hill, the top lobbyist groups are OEMs and the second is insurance groups. “They spend millions of dollars a year to get their agenda approved in Washington, getting results because of their lobbying efforts,” says Nordstrom. “We need to make our dollars count so that we are viable to those guys in Washington.”
Several international attendees echoed the sentiments in the room. “We have the same interests,” noted a leader from the Polish delegation. “In talking to different members, thirty yards have gotten together to do some things. I also see buying groups etc., and we must remind ourselves to work towards a common agenda on many of these subjects. We must work together to figure what is the best idea for the industry. In our country, the government came to the Polish auto recycling conference and heard what Michael Wilson said to group. It was helpful to illustrate to them that we all have the same problems and it is their obligation to help us.”
The Malaysian delegation was intently following the data and OEMs discussion, noting that, “We faced the same situation in Malaysia, four to five years ago. We conducted a study on industrial Malaysia, and went to the government to raise the bar on professionalism in the industry, and started more consumer awareness.”
The conversation then landed on a marketing note, with Amanda Matlock, ARA Gold Seal Chair, emphasizing the use of social media. “Use social media – your Facebook pages – to tell our stories, like the ARA Gold Seal page.” The fact that ARA launched a new Awareness Campaign spurred discussion. “People need to know what we do,” said Robertson, who was on the working group to formulate the campaign. “We need to go right to end-user advertising, bypass the middle man, with the message that this car is yours, you own it, it’s your choice. Ask for recycled parts, it is good for environment.”
Getting creative and marketing shouldn’t be directed only to consumers. Delanne Bernier, ARA’s Vice President of Government Affairs, emphasized the need to “market” the industry to legislators. “Senator John Thune (R-SD), [top left photo, pictured at right with Shannon Nordstrom, left] came to visit Nordstom’s facility. Getting him there took a creative process. Shannon knew Thune had a beloved car that was at the end of its life. His facility got the car and then dismantled it, but as they did, they took photos and created a Powerpoint presentation of the process. Eventually they were able to show him what his car went through as it was dismantled, which prompted his asking questions, and then a visit to the facility. Now he is a supporter.”
In general, the overriding roundtable theme was the call for unity. “Members ARE the association. We need to work together,” said Michael E. Wilson, ARA CEO. “As a membership, let’s look at what we do well and what can we change”
“We are learning lessons by looking at what is happening in other countries and how the automotive recycling industries are partnering with governments and corporations. Closed loop recycling is becoming the goal. We have to find our place in that process.” He cited companies like BMW and Renault, who have invited auto recyclers into the process in other countries.
With overall changes in the automotive business, this is an important aspect of the future of the industry. “OEMs want to control all the aspect of the car, from beginning to end,” said one auto recycler.
“For the older generation, the car was a passion. For the new generation, the car isn’t a priority,” noted another recycler. “The Super Bowl commercials showed autonomous vehicles, bike sharing, ride sharing.” Yet Amanda Zmolek from Copart, a millennial herself, responded that “there are still opportunities with ride sharing and Google, and the millennial. I still love cars and everything that is retro will become new once again. You can’t have a dilapidated car to be an Uber driver, many people do still drive and take pride in their cars.”
“Our industry isn’t going away, but how we do it may change and profit centers will be different,” noted Robertson.
Other notable comments mentioned in the roundtable session were:
“The fastest growing segment of salvage automobiles coming to auto recyclers is 16 years and older. Higher average auto ages will grow 30 percent in the next 3 years.”
“Body shops and their processes are going to change, and we have to adapt.”
“Back in the day, if you linked with insurance companies, you could not be successful. Now it seems its linked to OEMs, we have to create opportunity there or we will have issues.”
“With misguided OEM statements, it seems certification programs from CAR to ISO, etc., to certify the parts is the possible future? This is no small task…” That comment triggered references to the Texas auto body shop that recently was held liable for not following “OEM prepared procedures” to the tune of a $40 million-dollar judgement.
“It’s all about money and making money, closing down non-profitable areas in our businesses.”
At the end of the lengthy two-hour session, while the work still continues on these issues and others, the general sense of pride and unity felt in the room lingered throughout the convention. Voicing common concerns and discussing possible proactive solutions invigorated attendees, and moderators Nordstrom and Robertson hope it also creates more opportunity for a unified, healthy, and growing membership.
Caryn Smith is the editor of the Automotive Recycling magazine.