Remanufacturing of auto parts, components to generate new opportunities
It was recently revealed that there are more than 22 million vehicles on the road in Malaysia, with more than five million older than 10 years.
Taking an average of 600,000 new vehicles sold per year in the last five years, it is reasonable to estimate that there are some 19 million vehicles owned by the Malaysia populace are more than five years old.
It is also reasonable to assume that those who own a vehicle of more than ten years old would likely to prefer the “reusedparts” for their parts failure replacement.
Some 50 per cent of those driving more than five years old vehicles too would prefer used parts for their vehicle maintenance.
The above estimation shows that there are about 12 million vehicles nationwide whose owners may choose “reused”, or more commonly known locally as the “reconditioned”, parts and components for their vehicle maintenance.
On the other hand there are some 14,000 automotive repair and maintenance workshops that are registered with the local councils spread throughout the country which can be the promoting agents in the use of reconditioned parts and components.
This reflects the quantum and opportunities for businesses of the reconditioned parts and components services and supply within the aftermarket sector of Malaysian automotive ecosystem, providing jobs opportunities for the local workforce.
The realisation on the importance of the reconditioned parts and components industry is reflected in the National Automotive policy, NAP 2014, where greater emphasis is given to promote and to encourage the development of the local reconditioned parts production locally or globally known as Remanufacturing.
While encouraging a cleaner and environmentally friendly local aftermarket sector, the 4R2S approach will be adopted towards the development of the reconditioned parts and components industry.
The 4R activities shall encompass the development and enhancement of the repair, reused, recycle and remanufacturing of the used auto parts and components.
2S will focus on the development and enhancement on proper use of the “reconditioned” parts and components within the auto services and supply network.
Remanufacturing, an emerging industry of strategic importance globally, is key to the successful development and implementation of 4R2S.
Remanufacturing is a process where used parts are disassembled, cleaned, repaired, and reassembled to be used again on vehicles.
In comparison to the manufacture of new parts, remanufacturing is estimated to save energy by 60% and raw materials cost by 70%.
Remanufacture ensures the same product quality, durability and performance comparable to those of new components.
In addition, accessibility to “cheaper but almost like-new” components will be the main benefit gained by vehicles users through remanufacturing implementation.
A remanufactured part normally costs 50% to 75% that of a new one and customarily carries some warranty offer.
Components that are currently remanufactured within the global automotive industry include; air conditioning compressors, alternators, engines, fuel system components, rack and pinion steering, starter motors, steering system, transmission system, turbochargers and water pumps.
However, there is a need to regulate and to standardise the remanufactured parts and components distinguishing them from those of the salvaged components from the scrap yards which are reused, refurbished or repaired without undergoing proper testing and quality assurance procedures.
The remanufactured parts and components should be fully tested in compliance with specified standards fulfilling similar function, with warranty offer, liken to the original components.
Malaysia has the potential to build a strong remanufacturing industry with the existing manufacturing base coupled with the availability of an established and sound parts recycle industry.
Remanufacturing requires support from other activities such as; parts collectors, professional recyclers, disassemblers and cleaners to ensure consistency and sustainable supply of used parts and components as remanufacturing input. The demand will spearhead the development of more organised recycling activities within the local aftermarket ecosystem.