Company acquires its first shredder with the purchase of Florida’s U-Pull-It in late 2012.
LKQ Corp. Inc., Chicago, has announced it has entered the automobile shredding business with the purchase of a self-service auto dismantling yard and an adjacent automobile shredder in Florida. The acquisition of U-Pull-It, Davie, Fla., was part of 15 acquisitions that LKQ completed during the fourth quarter of 2012, according to the company. LKQ acquired 30 companies in 2012.
In a discussion following the release of the company’s quarterly numbers, LKQ managers said the decision to purchase the shredder would allow the company to buy vehicles that it historically would not . “We believe that by adding these new types of vehicles to our procurement mix we will lower our average cost per vehicle because we will be increasing our total share of buying [at] auctions.”
John Quinn, LKQ CFO and executive vice president, said by having its own shredder, LKQ can “reduce the risk of loss revenue and continue on our focus on maximizing the profitability of each of these vehicles we procure. Currently, this shredder is operating at half capacity. We anticipate running at full capacity by the end of 2013 with all current and future volume being generated internally with no reliance on third-party sources.”
LKQ says its considerable presence in Florida will allow it to obtain an ample amount of vehicles for the shredder, increasing its operating rate.
To read more about the dismantling and shredding operations of U-Pull-It, click here to link to a September 2012 Recycling Today profile story.