Toronto, Ontario -- November 22, 2017 -- This past summer saw some of the worst natural disasters of the decade hitting parts of the United States. Among the many industries affected by natural disasters stands the automotive recycling industry. CCC reported more than 300,000 vehicles were declared total losses following Hurricanes Harvey and Irma, said LKQ CEO Nick Zarcone. Zarcone told analysts that it was an opportunity to buy “a lot of good salvage.”
“It’s not like the front end is gone or the back end is gone,” said Zarcone.
He noted, however, that LKQ “can’t buy it all” because of space considerations, nor could its competitors.
“We need to have a place to put the cars,” Zarcone said. “You can’t put 40 acres of cars on a 30-acre salvage yard.”
LKQ corporate accounts Vice President Terry Fortner described how the company handled quality control for the parts potentially affected by flooding.
In a statement, Fortner said that when LKQ references “‘high-quality salvage’ … “we’re generally talking late model vehicles. We’re not going to sell an engine that’s been water logged and floodedas a useable and quality replacement part.”
In all, this suggests that salvage yards nationwide will be able to get in on the trend. Zarcone told insurers “there’s not going to be massive changes, massive gains” from the new inventory but the auto recycling industry ought to benefit a little for the next several quarters.
For more information on LKQ, please visit lkqcorp.com.