Thursday, 19 February 2015 00:00

Automotive Recyclers Association CEO Addresses CNN Report in Letter to Anderson Cooper

Dear Anderson, Drew and Scott:

The Automotive Recyclers Association (ARA) represents over 4,500 professional automotive recyclers across the United States and in 14 countries internationally. It is on their behalf that I express extreme disappointment and frankly surprise at the erroneous reporting displayed in the one-sided segment on insurance repairs that aired February 11, 2015 on CNN’s Anderson Cooper 360 broadcast. 

During the piece, it immediately became painfully obvious that CNN's research team is unaware of both the robust automotive parts supply chain that supports an increasing global market and the critical role that recycled original equipment manufacturer (OEM) parts play in that market. 

ARA requests that CNN retract the factually incorrect and misleading statements made about recycled OEM parts in this broadcast. For this segment to live up to CNN's " The Most Trusted Name In News" reporting slogan, CNN's investigative team should have contacted the stakeholder experts in the automotive parts industry, specifically the ARA.  If your team had reached out to ARA, they would have learned that there are many industries involved in the automotive parts supply chain and that to only address one portion of this expansive market sector does all stakeholders, including consumers, a disservice.

The team also would have learned that:   

  • The reutilization of quality, OEM automotive parts is a $32 billion dollar industry in the United States;
  • Each day over 500,000 recycled OEM parts that were designed and built to meet the automakers original requirements for fit, finish, durability and safety are sold directly to consumers as well as to repairs shops and automobile dealers who are very well aware that recycled OEM parts are being used in the repair of their vehicle;
  • Professional automotive recycling operations have robust product assurance and quality control procedures in place to identify parts that do not meet industry accepted standards.  These operational safeguards distinguish ARA members from what your segment refers to as "junkyards";
  • Most insurance policies allow for the utilization of recycled parts in vehicle repairs and educated consumers know that recycled OEM parts offer quality, safe parts at a fraction of the cost of new OEM parts;
  • Recycled parts play an important economic role in the marketplace. Without their existence, many times there would be no alternative part options to an expensive "new" part available for hard working Americans - leaving them at the mercy of automakers who would be in a monopolistic position in setting the price for that part; and
  • Automakers recognize the market demand for the reutilization of their original parts and the brand loyalty it builds.

What is also concerning is that your segment aired only one side of the Louisiana Attorney General's lawsuit against State Farm. If you had dug a little deeper to ensure balanced reporting, you would have learned of ARA's September 2014 response to Louisiana Attorney General Buddy Caldwell in which we took issue with his mischaracterizations and disparaging statements. 

He, like your reporters, wrongly referred to these parts as "nothing more than junk yard parts."  That is simply untrue.  Parts sold by professional automotive recycling facilities are recycled genuine original OEM parts that meet OEM requirements.  They are OEM parts, designed by the OEM, and built to meet the OEM requirements for fit, finish, durability, reliability and safety. 

The legal precedent that exists for this response was also missed in your reporting -- an historic ruling by the West Virginia Supreme Court of Appeals just last June which affirmed the use of salvage/recycled OEM crash parts in vehicle repairs and found that recycled parts are diametrically different from aftermarket parts.  

The CNN segment went out of its way to point to an alleged scheme generated by the economic interests of the insurance companies.  Viewers need to be aware of the economic benefits the body shops realize by steering consumers to utilize brand new OEM parts instead of using quality, recycled OEM parts - parts that provide the identical or improved repair service to new OEM parts.

ARA is troubled that CNN chose not to take advantage of the obvious opportunity to promote the significant environmental benefits realized through the reutilization of quality OEM parts. Automobiles are among the most recycled commodities in today's marketplace, which is increasingly supporting all things "green."  What your viewers should have heard as part of this segment was the significant savings of natural resources achieved by the reutilization of these quality OEM Parts. In addition, viewers could have learned that each year professional automotive recyclers collect and reuse or recycle from automobiles, millions of gallons of fuel, motor oil, engine coolant, and window washer fluid.

Given the blatant factual inaccuracies and mischaracterizations contained in this segment and the many angles of the story left unexposed, ARA requests that CNN retract much of this broadcast and after consultation with ARA, air a new segment educating viewers about the automotive parts supply chain, the many different ways in which professional automotive recyclers meet market demand for quality OEM recycled parts and how these parts are different than those parts your program sought to describe.

I can be reached at 571-208-0428 and look forward to talking with you about next steps to correct the record on the critical issue of the reutilization of recycled OEM automotive parts.

Sincerely,
Michael E. Wilson,
CEO

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