As with other countries, people need cars to go around New Zealand. However, being an island country far from primary car manufacturing hubs, it’s not surprising why residents are tempted to keep their cars until they’re no longer functional.
New Zealand laws require owners to scrap cars deemed unsafe on the roads, especially those over 15 years old. Vehicles that have gone through significant accidents or years of neglect and therefore need costly repairs must also be disposed of, ideally to companies like cash for cars Tauranga city has on its list of buyers and similar entities.
But what does it mean when firms offer cash for cars? And how do these entities impact the car industry? Find out the answers in this article.
Understanding the cash for cars concept
The cash for cars scheme works straightforwardly, and it’s done everywhere in the world. In this business model, companies offer to buy vehicles in cash, depending on the vehicle’s estimated market value. The good thing about selling to these firms is that they accept any unit, regardless of age, make, brand, history, and condition. This means you can sell your clunker to car wreckers Tauranga city and similar companies near you.
Once the current owner accepts the cash offer, the staff will take care of hauling the old vehicle and preparing it for repair and resale (or recycling).
The impact of cash for cars in the industry
Vehicles are no longer items of luxury but a necessity for most households. Unfortunately, car manufacturing entails significant resources. And it contributes primarily to environmental damage, from carbon emissions and non-renewable energy sources, to fuel and extraction of raw materials. All these happen even before vehicles hit the road.
Like other significant industries, the car industry was also impacted by the recent global happenings, and manufacturers continue to struggle due to several disruptions.
Car recyclers help reduce the impact of these industry challenges, as discussed below.
- Helping keep the roads safe
According to the New Zealand Automobile Association, the average car age in the country is 12 years, which is higher than in most progressive countries. Additionally, NZ has one of the highest vehicle ownership rates in the world, at 627 per 1,000 residents, likely because of cheap imports.
Based on New Zealand Transport Authority (NZTA) estimates, two out of three deaths and serious injuries are caused by vehicles with one or two safety ratings. These vehicles are often outdated autos that have seen better days.
Companies offering cash for cars schemes make vehicle disposal easier, reducing the likelihood of keeping old cars on people’s driveways and letting them use upgraded ones. Thanks to cash for cars Tauranga city has on its list of businesses, drivers are reminded to get a newer and safer car after selling an unreliable automobile. In some cases, they can also take care of de-registering scrap vehicles. As a result, fewer old cars will traverse New Zealand’s roads.
- Filling the gap in car shortages
The global car industry struggled to get enough raw materials before the pandemic, and the recent necessary physical distancing protocols aggravated the situation. Factory closures, labour shortages, and significant supply chain disruptions have driven car shortage troubles, raising the prices of newly-minted cars through the roof. Industry estimates these problems will reduce worldwide vehicle production by 7.7 million units.
While both new and used cars are affected by price increases, those on a tight budget have the option to check roadworthy second-hand vehicles from cash for cars Tauranga city or similar companies in their respective locations. Note that these entities don’t recycle all vehicles; repairable ones are resold on the second-hand market.
- Providing cost-saving benefits to automakers
Car prices vary based on several things, including the brand, materials and technology used, design, and various technical considerations. Nevertheless, auto manufacturers need basic materials such as glass, steel, rubber, paint, and plastic to make one. The creation and extraction process of raw materials is labour- and resource-intensive. With car recycling, these costs are dramatically reduced.
Currently, a huge chunk of car materials is recycled from old vehicles, most likely the ones sold, processed and acquired through cash for cars Tauranga city and in its neighbouring locations.
In the United States, industry estimates reveal that more than 25 million tons of material are generated from car recycling. Car recycling in North America generates enough steel to make 13 million new vehicles. Additionally, it contributes USD$ 25 billion to the country’s annual gross domestic production (GDP), making it one of the most significant sectors in the US. And, with up to 90% of auto materials being reused, cars have become the world’s most recycled product.
Cars are made of thousands of spare parts, making recycling extremely challenging. However, cash for cars Tauranga city and similar firms worldwide have trained staff and the right equipment for a seamless process.
By ensuring old and abandoned cars are properly handled, car recyclers help boost the car industry by keeping unsafe vehicles off the road, filling in the supply gap, and making car manufacturing less damaging to the environment. Ultimately, the cash for cars business model enables increased viability and sustainability in the auto industry.
- NZ Transport Agency. 2021. Scrapping a vehicle. www.rightcar.govt.nz. https://rightcar.govt.nz/scrapping-a-vehicle. Accessed 19 August 2022
- AA Motoring. 2022. Older cars. www.aa.co.nz. https://www.aa.co.nz/cars/buying-a-car/car-buying-guide/older-cars/. Accessed 19 August 2022
- Isidore, C. 28 September 2021. Automakers’ problems are much worse than we thought. www.cnn.com. https://edition.cnn.com/2021/09/28/business/auto-industry-supply-chain-problems/index.html. Accessed 19 August 2022
- National Geographic Staff. 04 September 2019. The environmental impacts of cars, explained. www.nationalgeographic.com. https://www.nationalgeographic.com/environment/article/environmental-impact. Accessed 19 August 2022