Services of America Inc. (ISA) is constructing a used auto
parts salvage operation adjacent to its shredder as part of its
strategy to increase its yield of valuable metals.
ISA Pull n Pay is scheduled for
a "soft" opening June 15 and expects to be fully operational by
July, president and chief operating officer Brian Donaghy told
The Louisville, Ky.-based scrap
processor announced in March that it would enter the auto
salvage business, noting it was unsatisfied with the quality of
vehicles it was receiving from auto wreckers.
"Auto wreckers dont supply
good-quality cars anymore. They are stripped down too far by
the time we receive them, and the (metallic) recovery is just
not there," Donaghy said.
With a self-serve auto parts
salvage operation and a shredder at the same address, the
company can avoid freight costs as well, he said. "One
advantage is (the salvage operation) will be a source of supply
for our shredders, and we will able to capture more of the
supply. Plus, we wont have to strip cars down all the way
because the eddy system will capture metals in the
Controlling the quality of
vehicles being fed into its shredder will help ISA increase
margins as the downstream system is expected to provide a
higher yield of nonferrous metal. "We are buying whole cars and
will turn the inventory as quickly as we can, predicated on our
purchasing power and meeting the shredders appetite,"
In addition to the installation
of a scale, ISA is building a showroom for customers and a
decommissioning facility. ISA has already purchased 1,000
vehicles and expects to have 1,500 vehicles when it ramps
"We hope to make it a profit
center as soon as possible," Donaghy said.