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The remains of hundreds of cars and other scrap metal. Photo: Tamara Keith
The remains of hundreds of cars and other scrap metal. Photo: Tamara Keith

Where do the "clunkers" go?

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The federal Cash for Clunkers program kicked off this past weekend, and dealerships were pushing it hard to sell new cars. The program was created by Congress last month to give a boost to the struggling auto industry while helping the environment. The idea is to get older polluting cars off the road for good and replace them with new more-efficient ones. But what will happen to all the clunkers? Tamara Keith went to find out.

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Tamara Keith
July 27, 2009

The federal Cash for Clunkers program kicked off this weekend, and dealerships were pushing it hard to sell new cars. The program was created by Congress last month to give a boost to the struggling auto industry while helping the environment. The idea is to get older polluting cars off the road for good and replace them with new more-efficient ones. Tamara Keith has this report on what will happen to all the clunkers:

Car dealers suddenly have a whole bunch of cars on their lots they have absolutely no use for. The clunkers cannot be re-sold. That would defeat the whole green goal of the program.

So all those old trucks and sagging sedans, they're headed to places like M and M Auto Parts in Stafford, Virginia. Most of us would call it a junk yard. But don't tell that to owner Rick Morrow.

"Long before green was popular, this kind of operation, even though a lot of people said, 'Oh junk yard.' But they were actually recycling cars. They were making use of what the component was built for in the first place."

His company's logo prominently features a large green recycling symbol.

"This is the dismantling area where after the cars come are inventoried and then take them apart."

Morrow's business is all about re-use. A fender, or a tail light, or maybe an alternator from this car will live to see another day in a car that needs a replacement part.

You'd think Morrow would be totally excited about Cash for Clunkers. But he's not. Because the one component from the clunkers that absolutely cannot be re-sold is the engine - pretty much the most valuable thing in the car.

"If we do a few dozen cars and it looks like it's costing us more money than it's worth, we'll say, 'sorry.'"

From an environmental perspective, it absolutely makes sense to prevent those engines from ever polluting again. But, from a business perspective it's a real problem for the nation's auto recyclers.

"It will make it extremely hard to make money on a car."

Scotty Davis is the vice president of All Foreign Auto Parts in Fredericksburg Virginia. He says it costs him $1800 in labor to take apart a car.

"It's going to cost me money to do this. It's one of these things. I have to bring the car in. I have to get rid of the tires. I have to get rid of all the fluids, the freon, process it - just to crush the vehicle."

Davis specializes in newer foreign vehicles. Parts from a clunker won't help stock his shelves. But he feels like he has to take the cars to stay in the good graces of the auto dealers he sells parts to.

"And I'll be very honest with you. A couple of them I do a lot of business with, I said, 'I will take your cars.' And they said, 'what are you going to do with them?' I'm going to crush 'em. I mean they're not of any value."

(sound of a shredder yard)

Once all the usable parts are removed, and the toxic chemicals cleaned out, most cars will end up at a scrap yard like United Iron and Metal in Baltimore.

"Right now you can see the tail end of a car coming on the conveyor belt down into the shredder."

"A tremendous amount of friction is going on as these hammers are pulverizing that car into small pieces."

Bruce Savage is with the Institute of Scrap Recycling Industries - a trade group. It only takes 15 seconds, and when the shredder is done with a car, it isn't even recognizable.

"That big pile over there is the end result. It's just a big pile of metal pieces."

Savage says the metal is then sold. Whether scrap recyclers will cash in on Cash for Clunkers all depends on the commodities prices for metal in the coming months.

"What was an old car can become a new car or can become a dishwasher or siding for a home. It depends on the materials. But everything is being reused, reprocessed and renewed."

So maybe a 1989 suburban can be reborn as a 2010 Ford Focus Hybrid.

For The Environment Report, I'm Tamara Keith.

2009 Environment Report

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