How Automaker Recalls Affect Auto Recyclers

OEM Information Needs To Be Shared

General Motors (GM) issued a massive recall of ignition switches on several of its models this past February. The faulty switches, which are found in 17.3 million GM vehicles, caused safety mechanisms, like air bags, to deploy. These malfunctions caused at least 13 deaths and more than 50 accidents. The recall has earned the attention of the National Highway Traffic Safety Administration (NHTSA), which has fined the company $35 million for concealing the ignition switch problems. The U.S. Senate is also investigating the automaker.

Although, GM is not the first automaker to issue massive safety recalls. Toyota dealt with a somewhat similar situation four years ago when it recalled less than 10 million vehicles for “unintended acceleration” problems. These recalls affect every part of the industry, but some have an edge over others. For example, dealerships know exactly which parts are affected in the recalls because that information is provided to them by the automakers. Thus, they won’t mistakenly sell a recalled part. But, it’s a different story for auto recyclers.

Recalls, like the current GM ignition switch recall, will 100 percent affect auto recyclers, both with full- and self-service facilities, said Andrew MacDonald, owner of Maritime Auto Parts in Nova Scotia, Canada ( and chair of ARA’s Technical Committee.

“(The recalls) put us in a position where we may be selling defective parts unknowingly to the public,” he explained. “In the recent sweep of GM ignition recalls, there was no traceability in manufacturing as to when newly counter-measured ignition switches were installed on the vehicles. So we have to assume that all of the ignition switches we have available to sell are defective.”

ARA, the Automotive Recyclers Association, has used this opportunity to challenge automakers to provide professional auto recyclers with VIN-specific original equipment manufacturers (OEM) data and live up to its “New Industry Standard For Safety.” Auto recyclers need this data to make sure the parts they sell aren’t included in this recall. So far, auto makers haven’t shared.

“The significance of OEM part numbers is demonstrated by the ongoing GM switch recall investigation and revelation that GM engineered a new ignition switch nearly a decade ago, however the redesigned part was not given a new part number - an act contrary to standard operating procedures,” said ARA CEO Michael Wilson in a June 2014 news release. The redesigned parts were introduced into the market and installed on GM vehicles and without a new part number, those corrected ignition switches are indistinguishable from the flawed switches that resulted in 13 deaths.

But, information about these parts can even go a step further.

“Even if GM had made a part number revision to their parts and we could identify them, our Hollander interchange database doesn’t include ignition switches - along with many other parts such as steering shafts, fuel tanks, shifter assemblies and more,” explained MacDonald. “If the interchange database had access to OEM build data, we could ensure that all of these safety related items that fall under recall are properly quarantined and deleted from our inventory to ensure that we are not reintroducing OEM defects back into the market.

The liability for the sale of one of these recalled items still falls back on the manufacturer. GM is currently paying out more than $400 million to compensate the victims of crashes surrounding the recall.

“If (the manufacturers) are unwilling to provide us with the data that is absolutely required to identify our parts, there is no reasonable way for us to identify, quarantine and delete defective parts. We can only go by what appears to fit and function for our customers,” added MacDonald. “If I knew the exact OEM part numbers that go on the vehicles we have in our recycling yards, then I believe the proper course of action would be to take these vehicles and delete the inventoried parts that fall under the recall. We would have an interchange so robust that I could know with confidence what exact parts all of our vehicles were built with, and how to protect the customer from the risks of buying a recalled part.”

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