Clunkers provide a bonanza for Southland junkyards
August 7, 2009
The Lincoln Continental with leather seats, the shiny gray Mercedes-Benz, the immaculate Lexus ES 300 and the impeccable Cadillac DeVille seem out of place in this San Fernando Valley junkyard, where wrecks of VW bugs and pickup trucks bare their smashed hoods like fangs at the pretentious newcomers.
They may be luxury cars in name, but now they’re just like the other clunkers surrendered for car-buying cash in the government’s Car Allowance Rebate System, or CARS.
It might seem like a waste. But to the scores of junkyards, auto auctioneers and scrap recyclers across the Southland, they’re as good as gold. Along with other industries, the auto junkyard and scrap metal businesses have been suffering through the deep recession.
As more people decided to forgo new-car purchases and hold on to their old cars, auto dismantlers also saw a decline in volume. They had fewer cars to put on their lots, which led to fewer parts to sell. Aadlen Bros. laid off five of its 100 workers this year.
The price of scrap steel dropped last fall from $550 a ton to $125 as carmakers and others bought less recycled steel, said Bruce Savage, vice president of communications at the Institute of Scrap Recycling Industries.
Now the federal cash-for-clunkers rules are boosting activity. Under the program, people can trade in their gas guzzlers and get $3,500 or $4,500 off the price of a new car
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