Automotive Remanufacturing - Global Strategic Business Report

Global Industry Analysts, Inc, February 2010, Pages: 276

This report analyzes the worldwide markets for Automotive Remanufacturing in US$ Billion. The report provides separate comprehensive analytics for US, Europe and Rest of World. Annual forecasts are provided for each region for the period 2006 through 2015. The report profiles 119 companies including many key and niche players worldwide such as Andre Niermann, ATC Technology Corporation, BORG Automotive A/S, Cardone Industries, Inc., Caterpillar, Inc., Fenwick Automotive Products Limited, Genuine Parts Company, Jasper Engines and Transmissions, Marshall Engines, Maval Manufacturing, Inc., Mevotech, Inc., Motorcar Parts of America, Inc., PROFormance Technologies, LLC, Remy International, Inc., Robert Bosch GmbH, Teamec BVBA, and TRW KFZ Ausrüstung GmbH. Market data and analytics are derived from primary and secondary research. Company profiles are mostly extracted from URL research and reported select online sources.

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AUTOMOTIVE REMANUFACTURING

A GLOBAL STRATEGIC BUSINESS REPORT

CONTENTS

I. INTRODUCTION, METHODOLOGY & PRODUCT DEFINITIONS

Study Reliability and Reporting Limitations I-1
Disclaimers I-2
Data Interpretation & Reporting Level I-3
Quantitative Techniques & Analytics I-3
Product Definitions and Scope of Study I-3

II. Executive Summary

1. INDUSTRY OVERVIEW II-1
The Economics of Remanufacturing: A Review II-1
Environmental Pressures Give Way to Economic Wisdom II-2
Remanufacturing Then: An Extended Producer Responsibility
(Regulatory Driven) II-2
Table 1: Environmental Impact of Automotive Component
Production: A Comparison of Green House Gas Emitted (in
kgCO2-eq) by Type of Manufacturing Activity -
Remanufacturing with Secondary Material, New Production with
Secondary Material, Remanufacturing with Primary Material
and New Production with Secondary Material (includes
corresponding Graph/Chart) II-2

Table 2: Environmental Impact of Automotive Component
Production: A Comparison of Waste Generated (in Kgs) by
Type of Manufacturing Activity - Remanufacturing and New
Product Manufacturing II-3
Remanufacturing Now: Market Driven II-3
Producers Don Dual Roles of Manufacturer and Remanufacturer II-3
Challenges to Reckon With II-4
Looking for Money in the Scrap Yard II-4
Automotive Remanufacturing: A Peek Into the Market's Structure II-4
Market Participants II-5
Key Market Trends & Issues II-5
How the Legislative System Shaped Remanufacturing in
Developed Countries II-5
Legislative Demands: Prime Drivers in Developing Countries II-6
International Trade in Remanufacturing Poised to Receive a
Boost II-6
Developing Countries Wary of Opening Up Their Markets to
Trade in Remanufactured Goods: Why? II-7
Economic Benefits: An Unassailable Business Case for
Remanufacturing II-7
Table 3: Value of New and Remanufactured Automotive
Components: Percentage Breakdown of the Real and Resorted
Value of Material, Labor, Energy and Plant & Equipment for
New Product and Remanufactured Product (includes
corresponding Graph/Chart) II-7

Table 4: Material Consumption Pattern in the Production of
Automotive Components: Breakdown of the Volume of Material
Consumed (in Kgs) by Type of Manufacturing Activity -
Remanufacturing and New Product Manufacturing II-8

Table 5: Energy Consumption in Production of Automotive
Components: Breakdown of the Volume of Energy Consumed (in
Megajoule (MJ)) by Type of Manufacturing Activity -
Remanufacturing (with Primary and Secondary Material) and
New Production (with Primary and Secondary Material)
(includes corresponding Graph/Chart) II-8

Table 6: Price Comparison of Alternators (2007) Breakdown
of Average Unit Prices (in Euros) Quoted by Type of
Provider - Independent Remanufacturer, OEM Remanufacturer,
Integrated Remanufacturer and OEM Manufacturer (includes
corresponding Graph/Chart) II-8
Rising Average Vehicle Life & Falling New Automobile Sales
Drive Remanufacturing II-9
Positive Outlook for Remanufactured Rack and Pinion Market II-9
Desire to Reduce Costs Leads to Advancements in
Remanufacturing Technology II-9
Extended Life of Original Equipment Engines and
Transmissions Hampers Growth II-9
Table 7: Automotive Remanufacturing: Breakdown of the
Average Age of Cores on Collection (includes corresponding
Graph/Chart) II-10
Bargaining Power Tilts in Favor of Distributors II-10
Noteworthy Market Challenges II-11
Growing Complexity of Electronics/Mechatronics Pose
Challenges in Remanufacturing II-11
Extended Vehicle Warranties: A Challenge to Reckon With II-11
Uncertainty Surrounding Timing & Availability of Cores II-11
Imbalance in Demand and Return II-12
Issues Surrounding Disassembly of Products for Remanufacturing II-12
Uncertainty in Recovered Materials II-12
Issues with Standard Item Routing Procedures for
Remanufacturing II-13

2. REGIONAL MARKET OVERVIEW II-14

2a. THE UNITED STATES II-14
A.Market Analysis II-14
Outlook II-14
Market Overview II-14
Automotive Remanufacturing as a Key Economic Growth Strategy II-15
US Market for Automotive Remanufactured Parts Thrives in
Recession II-15
Automotives in Prime Replacement Phase Drives the US
Remanufacturing Market II-15
Remanufactured Diesel Engines Grow in Volume, Automatic
Transmissions in Value II-16
Small Players Rule the Roost in Engine & Transmission
Aftermarket II-16
Key Statistical Findings II-17
Table 8: Remanufactured Engines Aftermarket in North
America (2008): Percentage Share Breakdown of Unit
Shipments by Engine Type II-17

Table 9: Remanufactured Engines Aftermarket in North
America (2008): Percentage Share Breakdown of Revenue by
Engine Type II-17

Table 10: Remanufactured Transmissions Aftermarket in
North America (2008): Percentage Share Breakdown of Unit
Shipments by Transmission Type II-17

Table 11: Remanufactured Transmissions Aftermarket in
North America (2008): Percentage Share Breakdown of
Revenue by TransmissionType II-17
B.Market Analytics II-18
Table 12: US Recent Past, Current & Future Analysis for
Automotive Remanufacturing with Annual Revenues in US$
Billion for Years 2006 through 2015 (includes corresponding
Graph/Chart) II-18

2b. EUROPE II-19
A.Market Analysis II-19
Outlook II-19
Market Overview II-19
Key Statistics: II-19
Table 13: Automotive Remanufacturing in Europe: Percentage
Share Breakdown of Annual Remanufacturing Volume by
Component Type (includes corresponding Graph/Chart) II-19

Table 14: Automotive Remanufacturing in Europe:
Non-Remanufacturable & Remanufacturable Cores Presented as
a Percentage of Total Recovered Cores (includes
corresponding Graph/Chart) II-20
Regulatory Overview II-20
Automotive Remanufacturing in the UK: A Special Focus II-20
Key Participants in Engine Remanufacturing Segments II-21
Challenges in the UK Market II-21
Meeting Challenges II-21
B.Market Analytics II-22
Table 15: European Recent Past, Current & Future Analysis
for Automotive Remanufacturing with Annual Revenues in US$
Billion for Years 2006 through 2015 (includes corresponding
Graph/Chart) II-22

2c. REST OF WORLD II-23
A.Market Analysis II-23
Outlook II-23
Automotive Remanufacturing in China: A Special Focus II-23
Government Initiatives II-23
Engine Re-manufacturing Project II-24
B.Market Analytics II-24
Table 16: Rest of World Recent Past, Current & Future
Analysis for Automotive Remanufacturing with Annual
Revenues in US$ Billion for Years 2006 through 2015
(includes corresponding Graph/Chart) II-24

3. REMANUFACTURING: A CONCEPTUAL OVERVIEW II-25
The Remanufacturing Process: A Review II-25
Automotive Remanufacturing II-25
Table 17: Automotive Remanufacturing: Percentage Breakdown
of Time Taken by Each Process (includes corresponding
Graph/Chart) II-26
History of Automotive Remanufacturing II-26
Auto Remanufacturing On Par with Original Manufacturing II-26
Benefits of Remanufacturing II-27
Capabilities On-Par with Originals II-27
Economic Benefits II-27
Environmental Benefits II-27
Less Energy Intensive II-28
Benefits to Developing Nations II-28
Remanufacturing: Essential Activities II-28
Sorting Items: A Crucial Step in Remanufacturing II-29
Unraveling the Confusion Over “Remanufacturing” II-30
Remanufacturing Vs Recycling II-30
Remanufacturing Vs Demanufacturing II-30
Remanufacturing Vs Repair II-31
Remanufacturing Vs Reconditioning II-31

4. PRODUCT OVERVIEW II-32
Engine Remanufacturing II-32
Remanufactured Engines II-32
Future Directions for Engine Remanufacturing II-33
Pumps Remanufacturing II-33
Remanufactured Transmissions II-33
Chassis Remanufacturing II-34
Remanufactured Rack and Pinion Steering II-34
Power cylinder II-35
Power Piston II-35
Control valve II-35
Remanufactured Power Steering Pumps II-35
Electronics II-35
Remanufactured Starters & Alternators II-35
Scope for Remanufacturing II-36
Remanufacturing Process for Alternators II-37
Key Statistics II-37
Table 18: Alternator Remanufacturing (2008): Breakdown of
Production Volume (in million units) by Regional Markets -
US and Europe II-37

Table 19: Alternator & Starter Motor Remanufacturing
(2008): Breakdown of Number of Re-manufacturers by
Regional Markets - US, Europe and Others (includes
corresponding Graph/Chart) II-37

5. RECENT INDUSTRY ACTIVITY II-38
FA Krosno Takes Over Delphi Clutch Remanufacturing Assets II-38
Motorcar Parts of America Purchases Reliance Automotive II-38
M&M to Form Joint Venture with Caterpillar II-38
Caterpillar Inks Agreement with Eaton II-39
Limco-Piedmont and TAT Technologies Merger II-39
Bosch Takes Over Holger Christiansen II-40
MISCOR Group Took Over American Motive Power II-40
BBB Takes over Wilson Auto, Wilson USA, Wilson Windings II-40
CARDONE Acquires 3 Plants of REMY II-41
CPI Completes Acquisition of Champion II-41
Deere Takes over ReGen II-41
Motorcar Acquires Automotive II-42
Motorcar Takes over Suncoast II-42
Centrum Takes Over Aftermarket Operations of Visteon II-42
ArvinMeritor to Take Over Trucktechnic II-42
Caterpillar to Purchase Part Assets of Gremada II-43
Daimler and Bosch JV Forms North American Fuel Systems II-43
SKF and Baosteel JV Forms SKF Industrial Service II-43
Messe Frankfurt Enters into Agreement with APRA II-44
ArvinMeritor Inks Supply Agreement with Navistar Parts II-44
CARDONE to Supply Multiline to REMY II-44
Deutz Establishes Diesel Engine Remanufacturing Facility II-45
TRW Establishes Remanufacturing Group II-45
SKF Establishes Bearings Remanufacturing Service Center II-45
TheAutoPartsShop.com Introduces New Website II-46
Mack Trucks Establishes Middletown Remanufacturing Center II-46
Dongfeng Motor to Build Its Remaking Facility II-47
PROFormance Technologies Takes Over Automotive
Remanufacturers de Mexico II-47
Windjammer Capital Investors Takes Over BBB Industries II-47
AER Sales Takes Over Universal Distribution II-48
LKQ Takes Over Keystone Automotive II-48
Caterpillar Acquires Eurenov II-48
ArvinMeritor Acquires Mascot Trucks Parts Ltd II-48
Remy Divests Diesel Engine & Component Remanufacturing Business II-49

6. PRODUCT LAUNCHES II-50
ArvinMeritor Offers Allison Automatic Transmissions and Power
Steering Gears and Pumps II-50
Cardone Introduces A1 Cardone Fuel Systems II-50
ArvinMeritor Adds Trailer Axles to Its Range of
Remanufactured Components II-51
Remy Introduces New 2008 Steering Racks and Pumps Range II-51

7. FOCUS ON SELECT GLOBAL PLAYERS II-52
Andre Niermann (Germany) II-52
ATC Technology Corporation (US) II-52
BORG Automotive A/S (Denmark) II-52
Cardone Industries, Inc. (US) II-52
Caterpillar, Inc. (US) II-53
Fenwick Automotive Products Limited (Canada) II-53
Genuine Parts Company (US) II-54
Jasper Engines and Transmissions (US) II-54
Marshall Engines (US) II-54
Maval Manufacturing, Inc (US) II-54
Mevotech, Inc. (Canada) II-54
Motorcar Parts of America, Inc. (US) II-55
PROFormance Technologies, LLC (US) II-55
Remy International, Inc. (US) II-55
Robert Bosch GmbH (Germany) II-56
Teamec BVBA (Belgium) II-56
TRW KFZ Ausrüstung GmbH (Germany) II-56

8. GLOBAL MARKET PERSPECTIVE II-57
Table 20: World Recent Past, Current & Future Analysis for
Automotive Remanufacturing by Geographic Region - the US,
Europe and Rest of World Markets Independently Analyzed with
Annual Revenues in US$ Billion for Years 2006 through 2015
(includes corresponding Graph/Chart) II-57

Table 21: World 10-Year Perspective for Automotive
Remanufacturing by Geographic Region - Percentage Breakdown of
Revenues for the US, Europe and Rest of World Markets for
Years 2006, 2009 & 2015 (includes corresponding Graph/Chart) II-58

III. COMPETITIVE LANDSCAPE

Total Companies Profiled: 119 (including Divisions/Subsidiaries - 127)

------------------------------------------
Region/Country Players
------------------------------------------
The United States 78
Canada 10
Japan 1
Europe 29
France 1
Germany 8
The United Kingdom 6
Spain 1
Rest of Europe 13
Asia-Pacific (Excluding Japan) 3
Latin America 2
Africa 1
Middle-East 3
------------------------------------------

The automobile sector has a long-standing relationship with the remanufacturing industry, as vehicle parts and components are subject to significant wear and tear, thereby necessitating repairs or replacements during their operating life. The evolution of the remanufacturing industry, which was hitherto driven by the pressures exerted by environmental regulations legislated by environmental agencies and governments, today stands poised for upscale proliferation guided by the economic rationality of remanufacturing.

Original equipment manufacturers (OEMs) are fast learning to adroitly maximize their profits by offering a judicious mix of both new and remanufactured versions of their product brands. Gradual dissipation of misconceptions surrounding captive remanufacturing activities is leading to increasing number of original equipment manufacturers commencing remanufacturing operations for their own products. Unfounded fears over remanufacturing eating into production volumes of newly manufactured products, thus negatively impacting economies of scale in existing capital-intensive manufacturing lines, are gradually beginning to ease. Additionally, given the strong brand equity, and reputation for quality in primary product brands, OEMs have an inherent competitive edge over independent remanufacturers in providing guaranteed level of quality and scalability for their own remanufactured products. Remanufacturing additionally gives OEMs an opportunity to tap into the perennial market for low-cost alternatives. This is especially important in the current scenario where recession-induced sensitivity to prices is helping inflate the market for cheaper substitutes, with the greatest beneficiary of this trend being remanufactured products.

The United States dominates the global automotive remanufacturing market as stated by the new market research report on automotive remanufacturing. The US market is especially driven by growing number of automotives in prime replacement/repair age. The growing popularity of expensive and sophisticated products such as rack & pinion steering gears and electric power steering, together with the rising demand for automatic transmissions and diesel engines, is expected to boost the automotive remanufacturing market to a great extent. Re-manufactured alternators and starters, which come with competitive warranties and low price points, are expected to become popular aftermarket products in future.

Participants in the remanufacturing industry can be classified under three categories - Independent Remanufacturing firms, Independent OEM Remanufacturing firms and Integrated Remanufacturing firms. Key players profiled in the report include Andre Niermann, ATC Technology Corporation, BORG Automotive A/S, Cardone Industries, Inc., Caterpillar, Inc., Fenwick Automotive Products Limited, Genuine Parts Company, Jasper Engines and Transmissions, Marshall Engines, Maval Manufacturing, Inc, Mevotech, Inc., Motorcar Parts of America, Inc., PROFormance Technologies, LLC, Remy International, Inc., Robert Bosch GmbH, Teamec BVBA, and TRW KFZ Ausrüstung GmbH.

© Global Industry Analysts, Inc.

- ATC Technology Corporation
- BORG Automotive A/S
- Cardone Industries Inc.
- Caterpillar Inc.
- Fenwick Automotive Products Limited
- Genuine Parts Company
- Jasper Engines and Transmissions
- Marshall Engines
- Maval Manufacturing Inc
- Mevotech Inc.
- Motorcar Parts of America Inc.
- PROFormance Technologies LLC
- Remy International Inc.
- Robert Bosch GmbH
- Teamec BVBA
- TRW KFZ Ausrüstung GmbH.

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