Auto Salvage Yards Complain of Dent in Their Business
The only person who walked through the door one morning at 5th St. Auto Salvage was a pest control worker with some small traps.
The Oxnard wrecking yard’s owner, Bruce Shepard, is in the auto recycling business--not the vermin management business--and said slow periods are all too common these days.
His phone isn’t ringing off the hook, the price of scrap metal is down internationally, and complying with increasing environmental regulations eats up more hours every day.
Shepard is a small auto-dismantler in an industrial section of the city. His car graveyard looks much like the dozen or so other companies in Ventura County that provide customers with used auto parts--old, rusted and mostly unorganized.
In the past few years, Shepard and owners of other area scrap yards have seen business squeezed by factors outside their control: Internet sales of cheaper aftermarket parts, plummeting scrap metal prices and the public’s general dislike for tinkering with their own vehicles.
Scrap yards collectively buy thousands of used, mostly demolished cars and trucks every year and resell their parts to auto shops or walk-in customers. Whatever remains is usually scrapped and sold by the ton.
The junkyards are large industrial plots of land filled with partly dismantled cars, trucks and heaps of parts. The area is not for the faint of heart--an unmechanical person could get lost in the rust and the dirt.
Sitting in his grimy office and wearing a blue shirt with his name on it, Shepard said he is selling fewer car parts now than he did eight years ago. And other salvage yard operators say they are making less money than they did 15 or 20 years ago.
“I don’t really know what it is,” Shepard said. “It’s everything.”
Shepard’s lament is the same as everyone else’s. He’s selling the same parts, for the same amount of money, but has to pay more for fees, permits and hired help.
As Shepard walks past row upon row of car carcasses stacked two high, he kicks one wreck and says, “People are buying new cars with low interest rates--not messing around with used cars as much right now.
“They used to come in by the droves, but you know times change.”
To deal with a shrinking bottom line, operators have devised several solutions, from trying to work more efficiently to creating specialties by stocking certain parts or types of cars. A few have gone out of business, but most keep chugging along in the same place they set up shop decades ago.
Shepard’s neighbor, Pacific Auto Salvage--with two acres of cars, rows of wheels, and taillights hanging on a fence--has created a niche with foreign cars, trucks and wheels.
“If I had 100 acres I’d take everything, but I don’t and I know my market,” said Doug McAden, owner of Pacific Auto Salvage, which his father founded in 1956.
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McAden’s customer base is increasingly Latino, he said. And increasingly, buyers are looking for the cheapest deal.
“My walk-in clientele has changed 100% over the last 15 years,” he said. “Thirty years ago, people with money could still diagnose their own car. Nowadays if you have money, time, whatever, you won’t get your hands dirty. Only the people that have to are going to.”
McAden said about 50% of his sales are wholesale--or to auto repair shops that are looking for used parts--and the rest are walk-in customers.
Walk-in customers may be looking for one odd part, but mechanics often buy in bulk and sometimes will price shop down to the last penny.
Carlos Vasquez, a 31-year-old who works for his father at Mario’s Garage in Oxnard, said the junkyards are invaluable to general repair shops. They provide rare parts or pieces of parts that would be too expensive or difficult to locate from the manufacturer. “A junkyard is used sometimes because there is no other alternative--like for an old vehicle piece that is not produced anymore,” he said.
Vasquez said he sometimes goes to his neighbors’ junkyards in search of a small part, like a bracket or a cylinder head or a connector. Instead of buying the whole part, he snips off the component he needs.
He said some parts are in perfectly good condition, like a carburetor, but new they would cost double the amount of used parts.
“The yards are really familiar with the rare stuff and they’ll get top dollar for it,” he said. “They know exactly what a new part costs, and then they’ll give you half off, or 30% off, depending on the part.”
And the deals can be even better. A recent customer looking for a horn on a 14-year-old Honda acquired one from a totaled car for $5. The same part, new, would have cost $53 from a dealer.
In Ventura County, there are about a dozen auto wreckers, mostly clustered in the west county. Santa Paula has several along one street, Oxnard has three within a few blocks of one another, and Ventura has a couple on its west side.
Operators said the industry is not cutthroat; frequently they help one another out. Most auto recyclers have an intercom on the shop wall where they can announce a part they are looking for. The intercoms are connected to several other shops locally that respond if they have any information about the part.
The shops also have access to a computerized network that is linked to hundreds of other junkyards across the nation. Operators can post information about parts for sale or search for those they need.
In a telephone conversation with a customer looking for a part, Shepard said in a gruff voice, “Don’t have it, but try Gean’s,” and he rattled off the phone number of a competitor around the corner.
“Why not help out,” he said with a shrug. “We all do it for each other.”
Don Akers, owner of Santa Paula Car and Truck Wrecking, said the biggest industry problem he faces is foreign manufacturers selling knockoff parts--everything from bolts to engines--over the Internet at prices that rival used components.
The junkyard business in Ventura County, however, is still very hands-on. Few local operators have a public Web site that catalogs the parts they have available. Local operators said marketing auto components via the Internet is mostly used for new parts or customized equipment.
Akers, who has been in the business 37 years, said he’s never chosen to specialize because most of his business comes from auto repair shops looking for a variety of parts.
“I have to sell to everybody that I can,” he said. “I need to make a living.”
Dan Layeman, who has owned Roscoe Auto Salvage in west Ventura for 30 years, said he finds business really slow lately, but he’s not sure why.
He specializes in Volkswagens, because “I’m lazy and don’t want to be lifting an Oldsmobile engine,” he said. “I was ready to retire 20 years ago, but I haven’t been able to.”
Some shop owners worry that politicians will rezone their industrial areas and they will eventually be out of business. But most feel secure knowing their business provides an essential function.
“If we didn’t exist, the tow companies wouldn’t be willing to pick up wrecked cars, because they wouldn’t know what to do with them,” said McAden of Pacific Auto Salvage. “We aren’t pretty like an ice cream shop, but they need us.”
Jack Kyser, chief economist at Los Angeles County Economic Development Corp., said auto recycling is a cottage industry that may be largely invisible but is definitely viable.
“We have a huge volume of automobiles in Southern California and we don’t have a rust problem, so cars can be recycled more vigorously,” he said. “We also have a growing immigrant population, and as quickly as they can they buy a car.”
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Junkyards are an ideal place for lower-income motorists to purchase parts for less money, Kyser said.
“There is also the green aspect,” Kyser said. We “can’t have decaying cars with pollutants getting into the ground. And recycling takes care of that.”
John Beifuss, owner of Tri-County Auto Dismantlers in Santa Paula, said that although the industry has changed since his father started the business 30 years ago, it’s not as difficult as some say.
“I haven’t felt the crunch, to be honest,” he said. “Nowadays, we sell pumps and air bags and things they didn’t have back then.”
Beifuss, however, mentioned the headaches and paperwork related to environmental issues, and that the business has become a little more competitive.
“It hurts a bit, having those parts made in Taiwan. There are a lot of aftermarket parts. But my business is basically the same,” he said.
Glenn McElroy, president of Pick-Your-Part Auto Dismantling, owns 18 shops in California and Texas. He cited international factors as the biggest detriment to his business, including a shop in Santa Paula.
“The environmental issues put pressure on your bottom line, but you can deal with that,” he said. “The real pressure is that since the Asian [financial] flu and the Russian meltdown, our scrap metal market has plummeted.”
Prices for scrap metal dropped from around $80 per ton to about $40 a few years ago. “We lost 50% of our revenue overnight.”
Nonetheless, McElroy said his business is still profitable. He plans to add new stores in California and Texas in the coming year.
“The biggest mistake I made was buying a junkyard in the middle of a river,” McElroy joked of his local yard’s proximity to the Santa Clara River. “Sometimes I need a boat to get to work.”
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