1/8/2009 Saving with Salvage
St. Cloud Times

Saving with salvage
Car owners seem to be mostly turning to used parts, cheap repairs — but only when they have to
By Britt Johnsen

We already know that people aren’t buying cars these days. But did you know they aren’t even fixing them?

Not until they have to, some local businesses say.

People are pinching their pennies. So much so that they aren’t even turning to auto parts stores as often.

Conventional wisdom might say repair shops and auto parts stores would do well in a recession, since fewer people are investing in new or used cars.

But not this one.

Car owners are increasingly turning to businesses that sell parts from salvaged vehicles, often 30 to 70 percent cheaper than new auto parts, some local business owners said.

Busy stores, dealers

At auto parts stores and dealers where they repair cars, an especially snowy winter has kept them busy.

But before winter, business wasn’t as busy as you might think an auto repair shop would be when people aren’t buying many cars.

Scott Lambert, executive vice president of the Minnesota Auto Dealers Association, said business is down at dealers 30 to 40 percent. And 40 dealers in Minnesota closed in 2008, he said.

“It’s a tough time,” he said. “You can only sell nothing for (so long).”

At some stores, people are still declining to buy alternators, tires and batteries until they have to. That’s the case in Sauk Rapids at Lincoln Radiator & Auto Repair. Owner Ron Schaefer sounds frustrated when he talks about how business is down, about 20-25 percent in the last year. “Everybody’s very price conscious,” he said.

“I just don’t understand them,” he said. People often refuse to replace something as simple as batteries. The thing is, he said, people might be risking their bank accounts in the long run, what with towing and replacement expenses when a car fails.

For example, not replacing a battery when it’s weak can cause it to die suddenly when it gets cold out, Schaefer explained.

At NAPA (or National Auto Parts Association), business is down about 10 to 15 percent, said Eric George, who works in retail at the St. Cloud store. When winter came down last month, clobbering the St. Cloud area with snow, business picked up.

“People in general are not spending money,” he said.

Not everyone is choosing not to spend money at auto parts stores — at least one auto parts company says it is staying busy, despite the down economy.

Automotive Parts Headquarters in St. Cloud has opened 37 stores in the last three years, many by acquiring other businesses, said Corey Bartlett, president. And its revenue was $70 million in 2008 — many steps up from its $25 million revenue in 1994.

Salvage stores

When people do spend money, they are looking for ways to save. So many are turning to places where they can get their repairs and parts cheaper, business owners said.

“It’s pretty good right now,” said Wes Bradford, who does marketing for Pam’s Auto in St. Cloud. He says his company has seen an increase in business of 25 to 30 percent in the last year.

The business buys and processes about 30 salvaged cars per week, handling about $10 million in inventory each week. It dismantles the vehicles and sells parts. They sell more than 50 common parts, including starters, alternators and others.

He said that depending on the item, customers usually can save 30 to 70 percent on a recycled part instead of a new one. During a recession, then, their business tends to do just fine, he said.

“I think typically if the economy is pretty solid, business is pretty good for us. If the economy is a little tired, business is pretty good for us,” he said. “We’re a little bit (of) a win-win.”

Same goes for Countryside Auto Salvage in Sauk Rapids, which resells used parts, usually from old cars but sometimes from new ones.

Jim Maier, a mechanic at the business, said people are not coming in as often as they normally would when their bank accounts are a bit more plush. But he has noticed an increase in used tire sales, by about 15 percent in the last six months. You can usually get a tire for $70 to $200 if you buy it new, he said. But at their place, someone can get a tire for $20 to $75, he said.

For Martini Auto Parts in Avon, business was as slow as many other companies. Phones weren’t ringing as often. Business was down about 5 to 10 percent.

But when winter hit, more people looked to the Avon parts store, which sells parts from salvaged vehicles and some new parts. Business has doubled, said owner Mark Martini.

The point being, when people do loosen the clinch on their hard-earned dollars, they’re looking for ways to save.

“People aren’t spending any money... unless they absolutely have to,” he said.

Key words: recycling, donated automobiles, salvage, used parts,

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