Car Collisions Produce Used Car Parts & Exports; Copart Sells Totaled Cars Online; Builds Crashed Car E-commerce & Salvaging Profits

SITUATION:
Processing & reselling salvaged vehicles has been major part of Copart Biz.
Is leader if not dominant source of used parts & totaled vehicles in U.S. & globally.
Innovative Biz model made founders billionaires & Stock market favorite.
Now to see how damaged EVs & AVs impact the supply chain & market model.

SIGNIFICANCE:
A salvaged vehicle is one that has enough damage to be written off.
Too much damages to economically & mechanically be repaired.
The sale of the damaged vehicle is done entirely online by Copart.
Copart lots have remained open during pandemic lockdowns

SOLUTION:
Copart buys the damaged vehicle, moves to lot, & then auctions online.
Some damaged vehicles become drive-able when sold overseas or other countries.
Insurance companies are increasingly selling damaged vehicles to salvage.
As replacing hi tech equipment in damaged vehicles makes fixing expensive.
Has refurbished facilities & added new online virtual QR Code queues

SEZ

“If you have a front end collision and you’ve got an automated driving system, the repair cost can be up to 5 or 5 times to fix a bumper with sensors.”
—Gary Prestopino, Analyst, Barrington Research

“Car are becoming like tv sets—wear out or damaged throw them away”

STATS:
Copart Net Income was $700 M in Fiscal 2020 on $2B Sales.
Copart has 234 lots in the U.S.
Somewhere between 9%  & 14% of crashed vehicles are totaled every year.
There are 274 M vehicles in the U.S.
Copart stock jumped 150% in January: Generated more profits than 2019

SOURCE:
Forbes Article “ Junkyard Billionaires”, December 2020 Issue – https://www.forbes.com/sites/giacomotognini/2020/11/16/how-to-make-a-billion-dollars-junkyard-cars-copart-salvage/?sh=4fa91e7c7498

KEY PEOPLE:
Jay Adair- CEO – Worth $ 1.4 B
Willis Johnson – Worth $1.1B

Leave a Reply