Recently, the National Development and Reform Commission issued an announcement on the "Interim Measures for the Administration of Auto Parts Remanufacturing (Draft for Comment)" for public comments (hereinafter referred to as the "Interim Measures"). The system recycles used motor vehicle parts for remanufacturing (hereinafter referred to as "auto parts remanufacturing"), and the state will encourage remanufacturing enterprises to apply for third-party remanufacturing quality management system certification, support industry associations to formulate relevant standards for quality management system of remanufacturing enterprises.

At the same time, the Ministry of Commerce and other seven departments announced the implementation rules of the administrative measures for the recycling of scrapped motor vehicles, which stipulated the scrapped motor vehicles from the aspects of qualification identification and management, code of conduct for recycling and dismantling, code of conduct for recycling and utilization, supervision and management, etc. The introduction of multiple rounds of policies related to the recycling of scrapped motor vehicles and parts will also strengthen the re-hematopoiesis ability of the automobile market and promote the development of the auto parts industry. The parts remanufacturing industry has a broad prospect.

Encourage the development of remanufacturing circular economy

According to the interim measures, enterprises engaged in remanufacturing should meet the recycling capacity of old parts that can meet the requirements of remanufacturing production; they should have the technical equipment and production capacity for dismantling, cleaning, manufacturing, assembly, product quality inspection, etc.; they should have the technical means and ability to detect and identify the performance indicators of old parts. Remanufacturing enterprises should build a reasonable reverse logistics system and old parts recycling network, and formulate old parts recycling standards.

One of the highlights is that remanufacturing companies that have passed the third-party remanufacturing quality management system certification can purchase scrapped automobile engines, steering gears, transmissions, front and rear axles, and frames (hereinafter collectively referred to as "" Five assemblies ") components shall not be recycled for remanufacturing or resale. The sale of the "five major assemblies" of scrapped motor vehicles to remanufacturing enterprises will also meet the needs of the development of circular economy and improve the recycling value of motor vehicles.

The Interim Measures also stipulate the production management and product management of remanufacturing enterprises. It is clear that remanufacturing enterprises should prepare inspection procedures or inspection work instructions, clarify process requirements and control methods, and adopt the same or more stringent standards as prototype new products. And have the necessary cleaning, testing, processing and assembly, environmental protection facilities and equipment. In terms of product management, ensure that the remanufactured products produced and sold have the same quality characteristics as the prototype new products, and carry out the same inspection and testing as the prototype new products when leaving the factory, and the safety standards should not be lower than the national requirements for motor vehicle maintenance accessories.

The previously issued "Detailed Rules for the Implementation of the Administrative Measures for the Recycling of Scrapped Motor Vehicles" (hereinafter collectively referred to as the "Implementation Rules") also pointed out that the market-oriented, professional and intensive development of the scrapped motor vehicle recycling and dismantling industry should be encouraged, and the recycling system of scrapped motor vehicles should be improved., Improve recycling efficiency and service level. To implement the reform requirements of "release, management and service", the detailed rules for implementation delete the provisions on unified planning and reasonable layout of the recycling industry, no longer implement quantity control on recycling enterprises, and at the same time lower the entry threshold of enterprise qualification, cancel the conditions such as registered capital, site area and number of personnel, and require enterprises to meet the requirements of environmental protection in terms of storage site, equipment and facilities, and dismantling operation specifications.

Remanufacturing industry has broad prospects

As a big country of automobile consumption, the scale of automobile industry in China has been ranked first in the world for nine consecutive years, and the scale of auto parts market has been expanding. The release of auto parts related policies will also help standardize the remanufacturing behavior and market order of auto parts, ensure the quality of remanufactured products, accelerate the standardized and large-scale development of the remanufacturing industry, and bring broad prospects for the remanufacturing industry of auto parts.

According to statistics from the Ministry of Public Security, as of June 2020, the number of motor vehicles in the country reached 0.36 billion, of which the number of cars reached 0.27 billion, the number of motorcycles reached 68.896 million, and the number of new energy vehicles reached 4.17 million, an increase of 360000 compared with the end of last year, an increase of 9.45 percent.

Cui Dongshu, secretary-general of the Federation of passengers, said that due to the rapid growth of the automobile market, the scale of scrapping will also explode, and the loosening of scrap recycling will promote the explosive growth of the number of scrap recycling.

The development speed of the market scale of China's auto parts industry tends to be stable. Statistics from the China Association of Automobile Manufacturers show that in 2018, China's auto parts manufacturing enterprises achieved sales revenue of 4 trillion billion yuan, an increase of 7% over the same period last year. The overall situation tends to be good. It is estimated that the sales revenue of China's auto parts industry will reach 4.61 trillion billion yuan in 2020. With the development of the innovation environment in the field of auto parts, the continuous optimization of policies, and the continuous improvement of the industrial chain, auto parts, as an important part of the overall competitiveness of automobiles, still have greater development opportunities.

Under the stable development of the automotive and parts industry, the recovery and development of the parts field is driven simultaneously. In 2019, the number of motor vehicles recycled nationwide reached 2.295 million, up 15.3 percent year-on-year, with 1.951 million cars, up 16.8 percent year-on-year, and 344000 motorcycles, up 7.1 percent year-on-year.

Cui Dongshu said that at present, a large amount of social capital has poured into the scrapped car recycling and dismantling industry, and phenomena such as mergers and acquisitions, financing, and listings are frequently occurring in the car recycling industry. "Chain dismantling companies have a good impact on dismantling and remanufacturing of old parts. Good value-added space will inevitably drive an investment boom, and the technical level of employed enterprises will also be greatly improved. In the face of the rapid growth of car ownership and the rapid increase in the amount of scrapping, the new regulations on car scrapping are of great significance to the industry."