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Junkyards dog automakers on used parts

By Claes Bell, CFA · Bankrate.com
Wednesday, November 3, 2010
Posted: 5 pm ET

Last week the Automotive Recyclers Association, a trade group representing America's junkyards, threw down the gauntlet to Honda and Hyundai. The two Asian automakers had released statements discouraging the use of recycled/salvaged parts for car repairs, saying reusing parts, especially those gleaned from totaled cars, represented a safety risk to passengers.

Junkyards say their products are safe for major repairs, but automakers disagree. (photo by Philip Kromer)

Junkyards say their recycled parts are safe for repairs. (Photo by Philip Kromer)

The ARA responded by filing a formal letter of complaint with the Federal Trade Commission, suggesting the automakers may be in violation of the Magnuson-Moss Act of 1975. Magnuson-Moss, among other things, prohibits automakers from requiring owners to buy original equipment manufacturer, or OEM, parts in order to have their warranties remain valid.

I couldn't find a copy of the Honda announcement, but the Hyundai statement basically says using recycled parts could hurt a car's crashworthiness, especially if they're used to repair a car after an accident. It reminded me of comments from Ford a few months ago following a study the automaker did on how non-OEM parts fare in collisions; basically, the automaker questioned the safety of duplicate parts that sometimes didn't work well with finely tuned safety systems.

I can see why the ARA doesn't like the Honda and Hyundai positions on this issue. If automakers come out en masse to say recycled parts aren't safe, it could put a big dent in their sales to individual consumers working on their own autos. Further, such a move could affect how mechanics and auto insurance companies, two parties that have a lot of say over which parts are acceptable for repairs, feel about using recycled parts.

The ARA's position boils down to:

  1. If the parts are unsafe, why are automakers putting them in their autos in the first place?
  2. Said automakers are just trying to stifle competition for their OEM parts.

Just like the controversy over non-OEM vs. OEM parts, this is all "he said, she said" until an independent entity does some kind of a real study. Until then, both the ARA and the automakers have too much money on the line to be trusted with an accurate analysis.

However, I do think that some sort of comprehensive study or mandatory testing needs to be done to determine who's right about the safety consequences of using non-OEM or recycled parts. Every year there are over 10 million reported traffic accidents, many of which result in significant structural repairs. With today's cars and their safety systems growing ever more complex, more work needs to be done to determine how these cars should be repaired to maximize passenger safety in the event of another accident.

What do you think? Are recycled parts safe? Would you want your car repaired with them?

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