Motor Industry Update 17 September 2021

SYNETIQ Green Parts Photo courtesy of SYNETIQ

SYNETIQ & Zurich partner to reduce CO2 impact of vehicle repair

SYNETIQ, the UK’s leading integrated salvage, dismantling and vehicle recycling company has announced a new green parts partnership with Zurich Insurance UK.

Zurich is the latest global insurer to entrust SYNETIQ with the sustainable and compliant supply of reusable green parts for vehicles, which will in turn allow Zurich to eliminate the CO2 emissions created by the manufacturing of new items for vehicle repairs.

SYNETIQ has managed to avoid over 5.5 million kilos of CO2 during the last two years through the supply of green parts to the industry, and one of the compelling factors of the new client partnership for Zurich, was SYNETIQ’s ongoing sustainability roadmap ‘Our Road to Tomorrow’, which is a long term project which includes a study into SYNETIQs Carbon footprint, as well as the precise CO2 savings that can be achieved using green parts.

All the green parts are Original Equipment, non-safety critical items, that includes things like doors, headlamps and tailgates. All the items are cleaned, checked and graded based on condition, and are procured through SYNETIQ’s automated digital platform, mygreenparts, which provides real-time data and insight on environmental and financial savings.

SYNETIQ has the largest and most diverse stock of green parts for most vehicles in the UK, which means that bodyshops, fleet and insurance companies help save the environment, money and time. SYNETIQ’s comprehensive stock management systems and rapid delivery means vehicle down-time is minimised, getting vehicles back on the road faster, for less.

David Nichols, Zurich’s Chief Claims Officer said:

“Green parts are a more sustainable way to repair components that are non-safety critical. By extending the life of parts that would otherwise be scrapped, we can reduce harmful carbon emissions while continuing to offer our customers high quality repairs. This partnership reflects our wider commitment to embed sustainability across our business, and we very much look forward to working with SYNETIQ.”

Neale Laker, Green Parts Director at SYNETIQ said:

“We’re thrilled to be working with Zurich as we join them in their green parts venture and embark on a joint sustainability journey.

“Green parts play an important role in helping us all become more sustainable and to help to reduce the motor insurance industry’s carbon footprint.

“Figures from a recent study carried out on our own parts procurement platform showed that in the past two years alone, the CO2 emissions saved as a result of using SYNETIQ green parts are enough to power a thousand homes for a year.

“At SYNETIQ, all our green parts conform to BS10125 making them perfectly fit for reuse which in turn, reduces waste and the need for unnecessary manufacturing – resulting in a positive environmental impact.

“As well as the green credentials, there are a number of other benefits. By adopting used OE parts, vehicles receive a like-for-like replacement – supplying parts from the exact same make and model. This stacks up well against sourcing a more expensive and less environmentally friendly brand-new equivalent or an aftermarket non-genuine part that may be of lower quality.

“We’re excited to be given this opportunity to work alongside an industry-leading insurer and to provide a quality green parts service which will not only produce efficiency and cost savings but will heavily contribute towards their own sustainability commitments.”

Consumer car finance market falls by 20% in July

Figures released last week by the Finance & Leasing Association show that the consumer car finance market reported a fall in new business volumes in July, down 20% compared with July last year. However, in the first seven months of 2021 new business volumes were 20% higher than in the same period last year.

The percentage of private new car sales financed by FLA members in the twelve months to July 2021 was 93.6%, up slightly from 93.2% in June.

The consumer used car finance market saw a fall in new business volumes of 19% in July compared with July last year, while the value of new business decreased by 16%. In the first seven months of 2021 new business volumes in the used car market were also 20% higher than in the same period last year.

Automotive supply chain shortages getting worse

Recent analysis by GlobalData suggests that the disruption to the global automotive industry’s supply chains caused by surging COVID-19 infection rates and lockdowns in southeast Asia is worsening.

GlobalData’s David Leggett says:

“The next month or so will be a very big challenge for the industry. Automotive supply chain shortages are worsening right now and recovery to fulfil a lengthening backlog of orders will take some time.

“The lockdowns have also compounded the acute shortages that already existed in the global semiconductor industry, forcing vehicle manufacturers to announce further production cutbacks.

“The COVID-19 pandemic has also exposed Malaysia’s importance in the global semiconductor supply chain. Strict lockdowns in the country in the last few months have made worse an already severely disrupted global semiconductor sector, significantly lengthening order lead times for chips and forcing automakers such as Toyota, Daihatsu, Ford and Mazda to announce extensive global production cuts in the third quarter of 2021.”

Hyundai to re-energize commercial vehicle market with hydrogen fuel cell technology

Following the news that South Korean automaker Hyundai plans to offer hydrogen fuel cell versions of all its commercial vehicles by 2028, GlobalData’s Bakar Sadik Agwan commented:

“Hyundai’s announcement to feature fuel cell electric or battery electric powertrains, as well as the application of fuel cell systems to all commercial models by 2028 is a ‘bold’ move by the company. However, prima-facie the target looks tough to achieve given the limited supply-demand trends for fully electric commercial vehicles presently, especially trucks. Hyundai has pioneered hydrogen tech in commercial vehicles with commercialization of its all-fuel-cell truck – the Hyundai XCIENT launched in 2020.

“Under its Hydrogen Vision 2040 that aims to achieve carbon neutrality, Hyundai wants to make hydrogen-based vehicles a key part of commercial transportation system. The auto company definitely have the first mover advantage in the hydrogen technology and the technology have some obvious benefits. But the cost-inflation that it brings compared to peer technologies such as hybrid and battery-electric will certainly pose a challenge for its wider adoption.

“However, Hyundai plans to achieve significant cost reduction via economy of scale and bring its hydrogen vehicles at par with battery-electric by 2030. It will be an important milestone for Hyundai if achieved. But, at a time when automakers are starving for boosting EV adoption in commercial vehicles, which is quite in early stage, it won’t be an easy to make hydrogen technology a mass commercial success. Hyundai’s XCIENT accounts for quite small volume sales, target sales by 2025 is 1,600 units.

“On a positive note, the hydrogen plan is a ‘win’ situation for Hyundai anyways. The market for FCEV development is less crowded as most passenger and commercial automakers are more focused on the mass adoption of battery-electric technology barring a few companies. This will give Hyundai a competitive edge in the fuel cell commercial vehicle market which will emerge as a key battle ground over mid-to-long-term.”