Today’s car buyers may not realize that, whether imported or American made, automobiles typically contain parts sourced from many countries. American icons such as the Ford Explorer SUV contain 50 percent North American made parts, while the imported Kia Sorrento contains 53 percent North American-made parts.nnAnother fact people may not realize is that when vehicles reach the end of their useful lives, the scrapped auto parts may also be shipped across the globe.nnGlobalization of automobile recycling is well underway and accelerating, with hard-to-foresee effects on American car recyclers. In part, it is impelled by growth in new vehicle production. The world’s car population passed 1 billion a few years ago and could reach 2.5 billion by mid-century. Last year, global manufacturers bolted together a record 60 million passenger cars.nnMost growth, like most current production, will not be in the U.S. or traditional vehicle sources like Japan and Germany. In 2012 the U.S. produced just over 4 million passenger cars, according to the Organisation Internationale des Constructeurs d’Automobiles (OICA), a global carmaker association, while China alone made over 15 million. In a dozen years, China is forecast to produce 25 million cars annually.nn“You look at the Chinese and it’s incredible what they are going to look like even in 2025,” said Michael E. Wilson, who as CEO of the Automotive Recyclers Association (ARA), a Manassas, Virginia-based trade group for American car recyclers, watches globalization closely.nnTwo major forces tied to expanding production drive globalization. First, growing carmakers have voracious appetites for recycled materials, particularly steel. Second, many countries are rapidly growing vehicle production without adequate provisions to recycle retired vehicles.nnThese influences are playing out already with one example being a deal signed last year by Insurance Auto Auctions (IAA), a big U.S. salvage auction company based in Westchester, Illinois, and Chenlong Recycling in Zhangjiagang, Jiangsu. The contract, under which IAA supplies Chenlong’s buyer with lower-end vehicles that are partially crushed and shipped from the West Coast, is one of the first results of the lifting two years ago of China’s longstanding ban on U.S. scrap car imports.nnChina isn’t the only country active in vehicle recycling. IAA, for instance, estimates that 30 percent of its vehicles are exported. Buyers come from more than 100 countries, and the auctioneer said it can assist them in 15 languages from English and Mandarin Chinese to Polish and Russian.nnGovernments of other nations are doing more than talking about recycling. Russia recently announced a new automotive recycling tax on domestic producers who don’t provide for end of life recycling. Last year Mexico published a national plan for processing scrap vehicles. And India unveiled a new center to develop environmentally and economically sustainable ways to improve recycling of vehicles built by its fast-growing industry.nnRight now, however, globalization spins on a Chinese axis. “IAA has taken an active interest in the China market because of the sheer size and rapid rate of growth within China,” said John Kett, IAA president and chief financial officer. “The China market represents a significant opportunity to IAA because of their demand for used cars that are being acquired for scrap.”nnRecycling U.S. cars saves China energy, money and pollutants compared to producing new steel from imported ore. “China has a huge appetite for steel,” Kett said. “Processing scrap automobiles can be done inexpensively (by comparison) and helps China to reduce emissions while feeding their demand for steel and other metals.”nnCurrently, Wilson estimates that 1 million salvage vehicles leave the U.S. annually. This creates a relative shortage, especially in California, from which the IAA exports to China have been leaving, he said. Recyclers there have faced decreases of 20 percent to 25 percent in vehicle availability, he said.nnHowever, globalization also represents opportunity for American recyclers. IAA, for instance, has found a way to benefit by supplying China with cars that will be partially crushed and then, most likely, have parts removed for re-use and in some cases shipment back to the U.S. And most countries have great need for American recycling technology, equipment and know-how, Wilson said.nnIn countries like China, India and Brazil, where vehicle manufacturing has grown very rapidly in the last 20 years, millions of cars will soon be coming off the roads, with very little existing recycling industry. “They have to have a structure in place and those are underdeveloped internationally,” Wilson said. “You hardly have any infrastructure in China. So they’re building that up.”nnMembers of the U.S. auto recycling industry are participating in the global build-up. The Washington-based Institute of Scrap Recycling Industries recently said domestic scrap equipment manufacturers already get 15 percent of revenues from exports. That is forecast to grow at 7 percent a year through 2015, the group said.nnIn some areas the U.S. is far ahead of most countries, including those with relatively well-developed recycling, particularly in re-use of parts, Wilson said. Nearly 14 percent of the U.S. market for collision-repair parts consists of used parts, he said, compared to about 5 percent in Australia and only about 1 percent in the United Kingdom.nn“Reuse is a higher form of recycling, because you’re saving all the energy by not having to reproduce the part,” he noted. “So there are greater opportunities there.”nnHowever, what works in America may not always be suitable elsewhere. For instance, in India most motor vehicles are two-wheeled, while most U.S. vehicles have four wheels. In India manual labor is cheap, again, unlike the U.S. So the Indian focus on recycling is on two-wheeled vehicles and using as much labor as possible.nnThese topics will undoubtedly be discussed November 6-9 at the ARA’s 70th annual convention in Phoenix, and again at the sixth International Roundtable on Automotive Recycling November 10-12, also in Phoenix. In an example of how far-flung U.S. automobile recyclers’ concerns have become, one subject will likely be the Panama Canal’s expansion. That project, to be completed in 2015, will let much larger ships pass from the Pacific to eastern U.S. ports.nnWhen that happens, huge container ships will be able to dock at ports like Baltimore, Norfolk and Miami, ready to load up U.S. scrap vehicles for export. Wilson said, “Then some of the things the Chinese are doing on the West coast will start to bleed over and affect a lot of our East Coast recyclers.”nnAmerican Recycler News – by Mark Henricks