ReMaTecNews | JUNE - JULY 2018 by RAI Amsterdam

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June/July 2018

REMANUFACTURING INTERNATIONAL NETWORK | KNOWLEDGE | BUSINESS

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IN SI

BorgWarner: Turbo power in Poland China lifts reman restrictions - but core barrier is still there Batteries not included: EV reman is harder than it looks

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EDITORIAL

‘The Remanufacturer of the Year Award is changing – and we make no apology for shouting about it’

ou may have noticed that the ReMaTec Remanufacturer of the Year (RotY) Award has been renewed. In fact, if you flick through this issue of ReMaTecNews you can’t miss it. The cover screams at you and there are items of news (p7), plus a two-page feature (p10) and a Viewpoint (p15) – not to mention all the online and social media activity on it - explaining what’s happening and why it’s a good idea for you to give it some attention. So why all the fuss? Well, for one thing it’s the most prestigious awards programme in the reman industry. And the second thing is that the time to get your entries in is fast approaching: you must do it

by June 26. Here’s a third thing: if you don’t enter, you definitely cannot win. At ReMaTecNews, we are rather proud of the award. If you look back over the list of past winners then it really does read like a ‘who’s who’ of the remanufacturing industry. These are people who know what success looks like. Speaking of success, the first Global Remanufacturing Day was a terrific initiative and the Remanufacturing Industries Council and its partners deserve a lot of credit for putting it together. It is a wonderful idea which really caught the imagination of loads of companies. You can see just a few of them on p19. ReMaTecNews will be honoured to do everything it can to make 2019’s version even bigger and louder. The only way reman is going to become better known is if people outside of our industry understand it – and appreciate the benefits it brings. Having said that, everyone likes to reminisce occasionally. With that in mind, we have a new feature in the magazine, called ReMaTecNews ReVisits, in which we look at the stories that have made the news in times gone past. In this issue, we go back to 2004. Hope you enjoy it – this is the closest we’ll get to time travel. Maybe we can find some answers to current problems there. As ever, please get in touch with me at editorial@rematecnews.com – or follow me on Twitter @ReMaTecEd if you are feeling bold. I don’t bite. It doesn’t matter how we connect: the important thing is that we have a conversation. Finally, did I mention you have until June 26 to get your RotY entry in? Thought so. Good luck!

Published by RAI Amsterdam B.V. P.O. Box 77777, 1070 MS Amsterdam The Netherlands In association with Route2Market Editor Adam Hill: editorial@rematecnews.com Phone: +44 (0)7931 502947 US correspondent Denise Rondini: drondini@gmail.com Asia-Pacific correspondent Tim Maughan: easternscribe@hotmail.co.uk Route One Publishing Managing Director Andrew Barriball: abarriball@ropl.com Project & Production Manager Miranda Le Croissette: mlecroissette@ropl.com Phone: +44 (0)1322 612080 Contributors in this issue Michael Haumann, Niels Klarenbeek, Daniel Koehler, Tim Maughan, Denise Rondini, Volker Schittenhelm, Andrew Stone Marketing Communications & PR Evelien Feijen: e.feijen@rai.nl Phone: +31 (0)20 54915 81 Advertising Sales Yorien de Ruijter Phone: +31 (0)20 5493075 Fax: +31 (0)20 5491889 advertising@ReMaTecnews.com Publisher Evelien Feijen (responsible under Dutch Press Law) e.feijen@rai.nl Design, Production & Printing Route One Publishing Ltd Copyright RAI Amsterdam, Amsterdam, The Netherlands Reproduction No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopied, or otherwise, without the prior written permission of the publisher, RAI Amsterdam B.V. Subscription magazine & eNewsletter www.rematec.com Change of address info@ReMaTecNews.com ReMaTecNews online www.rematec.com/news Circulation Approx.13,500 readers per edition. The magazine is delivered on a controlled circulation basis to recipients in Western Europe, Eastern Europe, Africa, North America, South America and Asia.

Adam Hill, Editor @ReMaTecEd

Enter the Remanufacturer of the Year Awards at www.rematec.com/roty now!

ReMaTecNews

2018

Do you have what it takes? Remanufacturer of the Year Awards 2018 Proud to announce that the most prestigious award in the industry contains a new set-up. Make sure to submit your entry now in the following categories:

NEW CATEGORIES ROTY AWARDS 2018:

Best Reman Process Optimisation

Best Reman Business Innovation

Best Reman Ambassador

ReMaTecNews

REMANUFACTURER OF THE YEAR 2018

Best Reman Process Optimisation

ReMaTecNews

REMANUFACTURER OF THE YEAR 2018

Best Reman Business innovation

REMANUFACTURER OF THE YEAR 2018

Best Reman Ambassador

Submit your entry now at: www.rematec.com/roty or

Jury The RotY awards jury is drawn from a mix of experts in their ﬁeld, all linked to remanufacturing across industries:

Adam Hill Chairman of the jury, Editor of ReMaTecNews

Organised by:

AD_ReMaTecNews_A4.indd 1

Erik Sundin Senior Lecturer & associate Professor at Linköping University Sweden

Volker Schittenhelm Corporate Member of FIRM Brussels

Fernand Weiland Founder APRA’s European Division

Tessa van Vlaanderen Co-Founder of Circular Futures USA

Felix Feuerbach Founder and Shareholder of Kemény Boehme & company Germany

Partners:

26-04-18 17:03

CONTENTS

R.E.M.A.N. in the U.S.A.

Batteries not included

Navistar started out in the farming community - but the group’s sights are firmly set on remanufacturing for the future

Sales of electric vehicles might give the automotive reman sector new opportunities - but remanufacturing batteries is not that easy

20 10

COVER STORY Want one of these? Then you must enter the Remanufacturer of the Year Awards by June 26 - don’t delay: go to www.rematec.com/roty

The wall has fallen

China’s lifting of restrictions on using reman products for warranty repairs seems like good news - but there is still the problem of cores...

Look out! Disruption ahead Remanufacturing is changing and we need to be ready: that was among the key messages from the APRA Europe Symposium 2018 in Budapest

BorgWarner has sited a new reman facility in south-east Poland: we went along to see what makes it tick

ReMaTecNews ReVisits

One day in your life The first Global Remanufacturing Day was a great success - but it can be even better in 2019

Email your comments and stories to editorial@rematecnews.com

Moving to the next level APRA Europe is appointing ambassadors for various countries to help overcome language and cultural barriers

Travel back in time with us to 2004 as we start a new series looking at remanufacturing’s past

Turbo power

Don’t just add multiply FIRM believes that working together is the only way to drive reman forward - and it has already been successful

ReMaTecNews

NEWS

HDA TRUCK PRIDE LANDS TURBO SOLUTIONS Turbocharger reman specialist Turbo Solutions has been acquired by parts provider HDA Truck Pride to enhance its services for the commercial vehicle aftermarket. Turbo Solutions, based in Pennsauken, New Jersey, remanufactures turbos for light-, medium- and heavy-duty trucks, and offers a one-year, unlimited mileage guarantee. Missouribased HDA has 750 distribution locations and 450 service facilities in North America. “Turbo Solutions allows our members to offer complete coverage for their customers’ aftertreatment needs,” said Tina Hubbard, HDA vice president of marketing and product management. “Our members are thriving in this growing category.”

Detroit Reman appoints Lewallen Brian Lewallen (pictured right) has been made president of Detroit Reman. Currently director of service operations for parent company Daimler Trucks North America (DTNA), he is tasked with “developing and executing innovative solutions” in reman and “contributing to the company’s environmental sustainability”. Lewallen began at DTNA in 1997 as a quality engineer and worked in various technical engineering roles before becoming director of operations for Detroit Reman in Kentwood, Michigan. He also has been a Detroit Reman

vice president in Kansas and Detroit. Meanwhile, Erik Johnson is to become general manager of the Cleveland Truck manufacturing plant in

Cleveland, North Carolina. He will lead all truck manufacturing operations and direct support functions at Cleveland, where the Freightliner Class 8 truck models, as well as Western Star 4700, 4900 and 5700 trucks, are manufactured. Johnson was formerly director of customer application engineering. In other appointments, Jane Rosaasen has been promoted to general manager of the Mount Holly truck manufacturing plant in North Carolina – she was formerly director of logistics and co-leader of the plant. DTNA’s HQ is in Portland, Oregon.

CER: too little free trade European remanufacturers have complained that barriers to trade are continuing even after free trade deals have been signed – with Brazil, Turkey and China singled out as particular culprits. This was one of the key findings from a European Remanufacturing Council (CER) survey carried out to mark the first Global Remanufacturing Day. Respondents said that new free trade agreements

must include clauses on the trade in cores and remanufactured product. Asked what was top of their agenda for the next 12 months, many reman professionals said: “Raising awareness of reman” with the public and policy makers. CER insisted: “The growing strength of our single voice for remanufacturers across Europe is supporting the movement at a senior level – and is certainly opening doors.”

DEX JOINS EATON

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CEC launches open circular economy database

Remanufacturing specialist DEX Heavy Duty Parts has become an authorised rebuilder for Eaton in North America. DEX currently employs 51 people at its remanufacturing centre in Advance, North Carolina. “We see this opportunity as an excellent way to effectively grow our transmission business,” said Darin Redmon, director of operations at DEX. “Eaton products and solutions are certainly well regarded in the commercial trucking industry and we definitely wanted to take advantage of that.”

Not-for-profit networking group Circular Economy Club (CEC) has launched a global, open-

sourced database. The aim is to allow people in the circular economy to find out more about

what other advocates are doing and to connect with them more easily. CEC, founded by Anna Tarí, says it now has 2,600 members (individuals and organisations) in 60 countries, and the new database showcases 3,000 circular economy-related initiatives. In February the CEC held its ‘Circular Economy Mapping Week’, which tried to pin down what projects were happening, and where. The new database is the fruit of that research and Tarí believes the data that has been gleaned will point to areas where more co-ordination and communication can be improved. • Anyone wanting to get involved can do so at www.circulareconomyclub.com

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NEWS

JASINK: REMAN MUST SHARE DATA Thijs Jasink has called on his fellow remanufacturers to share information to help the industry solve common problems. At the APRA Europe Symposium 2018 in Budapest, Jasink, who is chief commercial officer of Alec Electronics, made a request for more data sharing between remanufacturers – especially when it came to issues such as safetycritical components. APRA is the perfect organisation to help the industry do that, he insisted. “Now is the time to share the knowledge and help each other,” he said. “Let’s stay connected.” This could be particularly useful when trying to engage in lobbying for the industry – for instance with European policy makers, he said. Sharing data with European Union policy makers would enable the remanufacturing sector to present itself as a responsible partner in areas such as environmental protection. This, in turn, might allow the sector more leverage when pushing for other things that it requires from legislators. One thing is for sure, he concluded: “If we stand still, if we are reactive rather than proactive, we will fail.” • Full report: APRA Europe Symposium 2018, p12

Remanufacturer of the Year Awards – enter NOW! www.ReMaTec .com

Commission and ReMaTec’s Remanufacturer United Nations, of the Year (RotY) Award REMANUFACTUR ING INTERNATIONA believes RotY is has been relaunched with L NETWORK | KNO WLEDGE | BUSINE SS well worth getting three new categories which involved in. “The are designed to showcase fact that our work the breadth of international for a more circular remanufacturing operations. world is valued by The three awards – rather Then enter the Remanufacturer others and seen by than one overall trophy of the Year 2018 Aw ards by June 26 the public gave us – are intended to inspire even more motivation,” companies from nonhe explains. “I think automotive backgrounds the RotY award is a to put themselves good motivation for forward, as well as many to support the giving more ‘traditional’ development of our remanufacturers from industry with a lot of the automotive industry Also BorgWarner: Turbo powe passion. Additionally, the more opportunities to r in Poland China lifts reman restr s ictions - but core barri er is still there Batteries not included: E 8 Awaatrd yearly award brings faces put their businesses EV reman is harder D than it looks SI 01 ils roty INe RotuYl2l deecta.com/ to our business, and in the spotlight. The F t th ! a ter ow rem En nwww. shows that it is based on new categories are: the daily commitment of Best Reman Process Optimisation, Best individuals.” Closing date for entries is June 26. Reman Business Innovation and Best Reman Ambassador. Current joint award winner Peter Bartel, who won with Salvador Munoz Zarate last • For full details of how to enter, go to: year for their lobbying work with the European www.rematec.com/roty June/July 2018

Want one of these?

Europe diesel move by Nissan Nissan has become the latest car manufacturer to say it will gradually stop selling diesel cars in Europe. The softening demand seen by auto makers is a sign of concern from potential

buyers at the restrictions that are set to hit various countries. A number of urban authorities have indicated that diesel-only vehicles will be banned from city centres, for example. For

remanufacturers, it is more confirmation that electric vehicles are coming to the fore and that reman skills will need to adapt to deal with newer, more complex technologies.

IAAF appoints Knox as vp The Independent Automotive Aftermarket Federation (IAAF) has appointed Terry Knox as its new vice president. Knox has been a Member of the IAAF Council since 2016, and is managing director of Belfast-based CD Group. He said his aim was to ensure that the IAAF is “best-placed to continue to flourish in a world where autonomous and electric vehicles” will have a growing influence. “Targets set by government may seem on the horizon, but it is the hard work done now that will allow us to have a strong future in the aftermarket,” he added. “Connected car data transfer is a real threat to our industry.”

Email your comments and stories to editorial@rematecnews.com

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NEWS

Marc Langelaar

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ReMaTec supports turbine reman research New research supported by ReMaTec is to look into the feasibility and possibilities of remanufacturing wind turbines – a potentially lucrative area for reman. Netherlandsbased sustainability research group ECN part of TNO will conduct the exploratory study, results of which will be available through ReMaTecNews later in 2018. The research is supported by the industry associations Holland Home of Wind Energy (HHWE) and European Remanufacturing Council, as well as manufacturer and remanufacturer ZF Wind

Power. The research is led by Jos Beurskens, former unit manager, renewable energy, at ECN and an authority in the Dutch wind industry. Using the results as a basis for discussion, a conference will take place during ReMaTec 2019 (23-25 June 2019 at RAI Amsterdam) at which the wind energy sector can discuss remanufacturing potential. The research will focus on serial remanufacturing of elements such as mechanical systems. This could include the gearbox, main shaft, gears, brake discs, generator, vacuum engine – and also all

electronic sensor equipment. “Introducing remanufacturing as part of the end-of-life solutions for wind turbine systems enables the wind energy industry to make wind power technology even more sustainable than it already is, and it significantly contributes to a full cradleto-cradle system,” said Marc Langelaar, business unit director, wind energy, at ECN part of TNO. “Do not forget the additional benefits of further cost savings, material savings and a reduction of the payback time of a wind turbine installation.”

Bid to extend battery life Prolonging the battery life of electric buses and trucks is the aim of a new collaboration – in a move which could have significant implications for the future viability of electric vehicle (EV) remanufacturing. Research group the Fraunhofer Institute for Transportation and Infrastructure and data specialist ViriCiti have looked at how battery life can be extended by altering specific aspects of operations. The organisations create a battery stress report which gives specific advice, such as interchanging buses on steep roads, to prolong battery life. Such information is now available for ViriCiti’s international customers. Fraunhofer has expertise in the field of Lithium-ion batteries, while Amsterdam-based IT firm ViriCiti uses real-time data to look at aspects of batteries such as power, temperature, discharge and charge, evaluating what negatively impacts a battery’s running.

Don’t wait! Enter the RotY Awards now at www.rematec.com/roty

BBB BUYS TURBO SUPPLY The trend towards increasing consolidation in the reman sector has continued with automotive remanufacturer BBB Industries’ purchase of Turbo Supply, a US remanufacturer of turbochargers. Turbo Supply has a reman facility in Joplin, Missouri, and offices in both Odessa and Houston. The company provides turbochargers in both onand off-road applications, such as over-the-road trucking, passenger cars, agriculture, natural gas compression and construction. Tim Roth, BBB Industries executive vice president of business development, says: “Turbo Supply’s remanufacturing expertise and market understanding along with a proven ability of a talented team to provide high-quality products to a broad customer base is a natural complement to BBB.”

ReMaTecNews

RotY AWARDS 2018

This year sees the renewal of the Remanufacturer of the Year awards programme, with three trophies up for grabs instead of the usual one. Adam Hill explains what has prompted this change

his year, things are changing. Make no mistake, the prestige of the title remains the same – this is still the trophy that reman professionals really want to win – but ReMaTec has taken the decision to expand its scope. Instead of one award, there will now be three (see RotY Awards 2018: New categories). The reason for that is simple: the remanufacturing sector is expanding rapidly – and the award itself is expanding to reflect this.

Ro otY: the e wiinn ners so far… …

Greater recognition Last year’s winners – Peter Bartel and Salvador Munoz Zarate – are a perfect example of this shift. It was the first time that the RotY award had been given to two people rather than a single recipient – and they received the joint award for their work in lobbying and advisory activities with the United Nations and European Commission. The judges’ citation read: “They were the driving force behind the industry’s declaration of common definitions and have together

made a massive contribution to the greater understanding of the global remanufacturing sector by politicians and policy makers.” This is a significant step: because of their work – and that of some of their peers – the reman sector is gaining more general awareness and recognition. Automotive remains at the core of ReMaTec, but remanufacturing in other industries is increasing in importance, from heavyduty engines to industrial electronics, from office furniture to wind turbines.

Peter Bartel (left) and Salvador Munoz Zarate are the current holders of the RotY Award

2017 7: Salvador Munoz Zarate, Wabco & Peter Bartel, Circular Economy Solutions 2016 6: Rolf Steinhilper, Bayreuth University 2015 5: Søren Toft-Jensen, Borg Automotive 2014 4: Jack Stack, SRC Holdings 2013 3: Alan Smart, ATP 2012 2: Doug Wolma, Meritor 2011 1: Philippe James, Remy Automotive Europe 2010 0: Francois Augnet, TRW 2009 9: Carsten Bücker, BU Drive Group 2008 8: Johan van Gerven, MRT Engines 2007 7: Martin Detzen, MD Rebuilt 2006 6: Alexander Schäfer, MS Motor Service Int. 2005 5: Jens Lindholm, Holger Christiansen

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RotY AWARDS 2018

For that reason ReMaTec has broadened the awards: in short, any company can enter – and ReMaTec is openly inviting reman practitioners from non-automotive sectors to take part in the RotY Award competition, to gain the recognition they deserve and to claim industry leadership. Above all, it should be made clear that these awards are entirely open: RotY applicants do not have to be an exhibitor at ReMaTec 2019, nor do they have to advertise in ReMaTecNews magazine. It really is all about the quality of the submissions.

RotY Awards judging panel

Fernand Weiland, APRA Europe

Volker Schittenhelm, FIRM

Tessa Vlaanderen, Circular Futures

Erik Sundin, Linköping University Felix Feuerbach,

Felix Feuerbach Kemény Boehme & Company

Adam Hill (chairman), ReMaTecNews

The awards presentation is due to take place during Automechanika Frankfurt 2018 in September

Cross-sectoral experts

High impact

Since the RotY awards categories are open to all sectors active in remanufacturing, the jury also needed to change to reflect that. To that end, we have added cross-sectoral experts in remanufacturing, with engineering, academic and business consultancy backgrounds, to the panel (see box, RotY Awards judging panel). Two longstanding and respected veterans of the reman industry, Fernand Weiland (APRA Europe) and Volker Schittenhelm (FIRM), will reprise their roles. They are joined by Tessa Vlaanderen, co-founder of New York-based thinktank Circular Futures; Erik Sundin, respected reman academic from Linköping University in Sweden; and Felix Feuerbach, founder of German consultancy firm Kemény Boehme & Company. ReMaTec hopes that the new categories convince many different companies that the RotY competition is worthwhile for them. “Our aim is to make it attractive for everyone to participate in this award,” says Niels Klarenbeek, director, remanufacturing and refurbishment at ReMaTec organiser RAI Amsterdam. “Over its lifetime, the RotY Award has celebrated the achievements of some of the reman industry’s pre-eminent names. Within the industry it is considered a major accolade.” The profile of reman has never been so high. “At a time when green issues, conservation of resources, recycling and environmental responsibility are at the forefront of public concerns, the award is intended to highlight the huge commercial and environmental benefits of remanufacturing,” Klarenbeek continues. “That is the reason that we have renewed our award and jury panel.’

There is no doubt that winning the award has an impact. Peter Bartel, who was on stage in June 2017 receiving his trophy together with Salvador Muñoz Zarate, is very enthusiastic. “The RotY award came totally unexpected for me,” Bartel says. “I did not even know about the nomination beforehand. But I was thrilled and proud to receive the prize. Our company, Circular Economy Solutions, gained a lot of attention after the award presentation. And the fact that our work for a more circular world is valued by others and seen by the public gave us even more motivation. I think the RotY award is a good motivation for

many to support the development of our industry with a lot of passion. Additionally, the yearly award brings faces to our business, and shows that it is based on the daily commitment of individuals.” Despite the changes, the RotY Award continues to throw a spotlight on the very best that the remanufacturing industry has to offer. The trophies will still go to people who, and to companies which, represent reman with distinction. There are many people with the right skills and experience to win these awards – and they are urged to do so before June 26 – and may the best competitors win. • ‘Remanufacturers are a special breed’, p15

RotY Awards s 2018: New cate egories

Email your comments and stories to editorial@rematecnews.com

1. BEST REMAN PROCES SS OPTIMISATIO ON A technical category which will focus on companies with, for example, innovative cleaning technologies, state-of-the-art end-of-life testing, high-end core sorting procedures or other high quality initiatives. 2. BEST REMAN BUSINE ESS INNOVATION In this category we will look into disruptive business models towards remanufacturing. The winner of this category should be an inspiration to other remanufacturers, and might include independent remanufacturers who managed to work with OEs, or providers of reman as a service, and so on. 3. BEST REMAN AMBAS SSADOR This award will honour an organisation or individual that has significantly contributed to the awareness and/or acceptance of remanufactured products with the general public, or with policy makers. To enter the competition or for more information: please visit www.rematec.com/roty

ReMaTecNews

APRA EUROPE SYMPOSIUM 2018

The future is coming: let’s get ready for it A plea for greater transparency between remanufacturers was among the key messages from the APRA Europe Symposium 2018. Adam Hill reports from Budapest

egal issues, disruption on the horizon, and a request for more data sharing between remanufacturers - these were among the highlights of APRA Europe’s Symposium 2018. Encory - the joint venture ( JV) between BMW Group and ALBA Group – sent ripples of interest through the reman sector when it was announced a couple of years back. Hanno Grosseschmidt, Encory managing director, began the day by making the APRA audience laugh – admitting that he had to google ‘remanufacturing’ when he started out. But he soon saw the potential, Grosseschmidt insisted. His business has three elements: reman consulting, logistics and sorting, and used parts. The latter is a means of increasing customer retention of the older car segments of BMW’s business and the reman business aimed to build a wider portfolio of parts for BMW dealers. When it came to reman consulting, he confided that the company was “still harvesting the low-hanging fruit”, such as turbochargers, starters, alternators and so

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on, but that the plan might be to expand gradually to move onto more complex reman projects such as electronics.

Supplier network The JV’s reman strategy involved an expansion of the exchange parts portfolio, setting up competitive charges to ensure core return, and a marketoriented pricing strategy for exchange parts. “Encory is not doing it alone but with a network of suppliers,” he said. This co-operation allowed suppliers to grow their OEM reman business, he continued, typically with five-year contracts. Encory is positioning itself as a conduit between independent remanufacturers (“typically they don’t have the structures to work with complex businesses”) and OEMs. Quality was assured in audits by Encory and BMW, he explained – but he said more discussion was needed before the venture moved into safety-critical products. “Then it gets more complicated,” he concluded, and there was a decision to be made over whether the risks were worth it.

Local vision Taking the floor, Daniel Koehler, chairman of APRA Europe, outlined his new vision for the organisation (see APRA Europe moves to the next level, p28), which revolves around more attention to local representation in particular. “We have to work on customer visibility,” he said, admitting that the organisation had perhaps fallen behind when it came to communication on social media such as LinkedIn. “It is new for APRA, not new for the world,” he said. Volunteers would work in their own countries – such as France or Czech Republic – translating documents for members and increasing APRA’s presence outside of its traditional strongholds of Germany and the UK. This was welcomed by APRA members at the Budapest meeting, one of whom commented: “It’s been a long time coming.” It was pointed out that imports from the Far East, particularly China, are putting added pressure on European remanufacturers. “Reman will have to get used to more complex products, not commodities,” Koehler added.

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APRA EUROPE SYMPOSIUM 2018

Vanishing reman This theme was picked up in another presentation at APRA’s meeting. Professor Marcello Colledani, from the Department of Mechanical Engineering Polytechnic University of Milan, asked delegates that if starters, alternators, turbos, calipers and engines are to vanish, then what will you remanufacture next? He warned delegates that electric vehicles (EVs) are predicted to begin outselling those with internal combustion engines (ICE) in 2038. There are also estimated to be about 600 million EVs in circulation by 2040, with US, China and Europe among the main markets. Another shift will happen even earlier than that, Colledani said: “EVs will take off from the second half of the 2020s, when electric cars become cheaper to own than ICE models.” That is not long to wait – and remanufacturers need to be aware of the change this will bring to their existing business model.

Drivetrain problem Battery packs – something that remanufacturers are far less used to dealing with – would therefore become vital for future success. “If we only attract the drivetrain as remanufacturers we will only have 20% of the value of EVs,” he went on. Carbon fibre reinforced polymer (CFRP) lightweight parts, for instance, “would be more in your comfort zone”, he suggested. But there is a real diversity in the battery cells used by OEMs, and this can present opportunities for reman too. Is remanufacturing viable? “Yes,” he insisted. “The way these cells are assembled is not rocket science – it’s quite simple. These are quite common technologies, they are not so innovative.” Having said that, there are issues over the lowering price of battery technology, and over the competition that remanufacturers will face from the recycling industry. “You may experience barriers to reman in mechatronics and power electrics,” Colledani warned. But there was some light on the horizon: “The lifetime of engines will be higher than that of the car itself – so there will be opportunities for remanufacturers.” Understandably, APRA delegates wanted to know when he thought starters, alternators, calipers and so on would be around to remanufacturer. “That’s difficult to answer,” Colledani thought. ➤

Watch out! Disruption ahead Disruption is ahead for the aftermarket, warned Frank Merwerth, manager, fleet management solutions, Knorr-Bremse Truck Services. In his presentation, Aftermarket 4.0, he described how greater connectivity, digitisation, telematics and remote diagnostics were going to be game-changers. “The connected truck is a data goldmine,” he suggested. “Very high hopes are associated with digitisation. The potential can’t even be estimated.” Daimler, for instance, claims to connect 400 different data points with its truck diagnostic services. This is important because commercial vehicle fleets tend to operate on a net margin of 2% - so any advantage could have a significant impact on the bottom line. “This means there is a substantial optimisation potential for road transportation,” he commented.

Empty running The figures are sobering: just one-third of a truck’s day is driving – the rest is made up of standing, parking and loading or unloading; at the same time, a quarter of all runs are empty; and capacity utilisation is only 50-55%. “But vehicle connectivity can provide efficiency benefits,” Merwerth insisted. For example, fuel accounts for about one-third of a fleet’s running cost – and fleet management systems can reduce this by 20-25%. Telematics and remote diagnostics (increasing vehicle uptime) would increase in popularity, meaning that the product portfolio itself is becoming more diverse. For remanufacturers, this all has a distinct impact: it means there will be more and more electronics to deal with, along with increased numbers of mechatronics components and sensor technology, not to mention over-the-air software updates, he went on. This means that the reman sector would need to build up its electronics remanufacturing competencies in a world that is evolving fast. The big question is how companies handle this complexity.

Issues of liability Legal issues were to the fore when Dr. Johannes Graf Ballestrem, counsel at law firm Osborne Clark, talked APRA delegates through the challenges that remanufacturers face, in particular around trademark law. “Software running on engine control units (ECUs) combined with reman products sometimes needs to be updated,” he explained. “This can be a copyright issue.” In general, liability lies with the remanufacturer of a product. “Principally, you have the same obligations as the manufacturer,” he went on. “But if a defect can be traced to the OE then any claims can be passed on to them.” It was worth remembering that the remanufacturer was likely to be the first point of contact for the customer, whether it was a fault in reman or not, he pointed out.

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APRA EUROPE SYMPOSIUM 2018

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“ICE vehicles will not disappear right away. By 2030 they will still be the most widely sold type of vehicle. But definitely we should start talking about a transition sooner rather than later.”

The car market is shrinking – and an independent garage can’t even touch a Tesla: there will be no market share for them.”

Learning experience Ultimate responsibility Thijs Jasink of Alec Electronics focused on autonomous vehicles (AVs) and the issues which they threw up. “Safetycritical components are going to be more and more important,” he went on. But who has the ultimate responsibility? “If we remanufacture a safety-critical component in an AV which then has a crash – who is responsible?” he asks. Also, with data becoming ever-more pervasive, do remanufacturers understand all the information which is stored and what to do with it? “If you connect a phone to the AV, all your personal data will be stored.” Are remanufacturers allowed to delete it? “We need to make sure we prepare ourselves.” Software will become more critical, which creates more complications for the aftermarket. “The independent garage will disappear,” he predicted. “This is because the OEM is so heavily involved.

Shifting the tone of the meeting, industry veteran Clemens Ortgies talked about a different kind of opportunity – this time from the development of the Chinese market. His company, YC-Europe is the European sales organisation of Guangxi Yuchai Machinery Co. Ortgies pointed to five reasons to enter the European market with engines built in China - namely that companies could generate “reasonable sales” in the EU within five years; it would offer the chance to learn from “difficult” market requirements; firms could gather know-how in technology, marketing and structure; acquire partners for expanding their business; and finally, it would help European customers expand to China. Yuchai (which owns YC) already operates a huge engine remanufacturing plant in Suzhou, China, and he predicted that the next five years will reveal more changes in the global heavy-duty diesel

and gas engine business. At present this is dominated by the eight biggest companies, a limited number of which will survive as independent companies in the future. Smaller engine manufacturers are forced to co-operate due to the high cost of R&D for new technologies and emission standards. The number of different engine types will decrease due to the complexity of technology and exhaust gas treatment – and meanwhile, some engine manufacturers will leave some segments due to the lack of volume production and high emission standards, he said. Remanufacturers need to be aware of all these issues. APRA’s meeting in Budapest allowed reman industry figures to get together to debate new ideas, and examine ways of meeting future threats – and to network. Above all, the diverse presentations highlighted the fact that the industry is changing radically in numerous ways. But perhaps the strongest message came from Thijs Jasink of Alec, who suggested that the challenges brought by the worlds of new technology and Big Data could be met by sharing experience.

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NOTES & COMMENT

ReMaTecNews VIEWPOINT

ReVisits...

Remanufacturers are a special breed Niels Klarenbeek eople in the remanufacturing industry are a special breed. They don’t take no for an answer. Remanufacturers need to think out of the box. In case there’s a lack of cores, they will find another way to source them. In case of restrictions - whether legal, tax or OE policy - they find a workaround to get the process flowing. If their largest competitor needs a favour - they’re happy to serve them. You’ll never know when will be the next time you desperately need something in return. Their meetings at exhibitions and conferences seem like family gatherings where competitors sit side by side and share useful best practices while enjoying a friendly drink together. It is this can-do mentality that forms the basis of a successful remanufacturing business. Since 2005, ReMaTecNews has been putting the spotlight on one industry member with the Remanufacturer of the Year (RotY) Award. This year, instead of one main award, RotY is split into three new categories:

Best Reman Process Optimisation We are looking for outstanding engineering quality. For example, plant managers who pushed their

reman process flows to the limit, being an inspiration to others; process engineers who have adapted the latest innovative cleaning technologies, delivering staggering results; or reman programme managers who successfully integrated remanufactured components in their new production line, and so on.

Best Reman Business Innovation Here’s to exceptional cleverness: entrepreneurial strategists who managed to open up markets that no-one has ever entered before, creating rewarding futureproof business models – or maybe remanufacturers who looked beyond the borders of their own sector and found reman opportunities in an entirely different field.

at the level of politicians or with a general audience, their efforts should have been instrumental for peers and industry fellows. We know there are many people who possess the right skills in this industry – and we encourage anyone to take part in this competition. Make sure you enter at www.rematec.com/roty before June 26 – and may the best competitors win. Don’t wait! Send those applications in today (or tomorrow - as long as it’s before June 26). Niels Klarenbeek, director, remanufacturing and refurbishment, RAI Amsterdam

Best Reman Ambassador Last, but definitely not least, we are rewarding people or businesses dedicated to the promotion and acceptance of reman products. Whether it is within the distribution chain,

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October 2004 The acquisition of Wealdstone Engineering in the UK signalled Caterpillar’s ambitions to expand its remanufacturing operation to Europe and beyond. In an interview with ReMaTecNews, Caterpillar’s head of reman services, Steve Fisher, talked about how reman is a growing industry in both Europe and North America, and how there were other opportunities presenting themselves.

“In the emerging markets, China, for instance, we think that remanufacturing will play very well there,” he enthused. Fisher also agreed that the US had been late in adopting the environmental arguments in favour of remanufacturing. “We probably have been a little slow, at least not aware of it as much,” he commented. “We think that it’s a powerful trend in North America and that we’ll be well positioned to take advantage of it.” He pointed to the G8 Summit’s (then recent) 3R initiative – Remanufacture, Rebuild, Refurbish - which encouraged member nations to be socially responsible. “These trends are going to continue,” Fisher concluded. “What this means exactly and when it will happen, I’m not sure, but it will happen.” ReMaTecNews

COMPANY PROFILE: NAVISTAR

R.E.M.A.N.

in the U.S.A. Itâ&#x20AC;&#x2122;s a long way from its roots in farming but Navistar thinks that reman is the future â&#x20AC;&#x201C; and the company has big plans for electricals and all-makes products going forward... ReMaTecNews US correspondent Denise Rondini finds out more 16

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COMPANY PROFILE: NAVISTAR

“Eventually diesel particulate filters are going to go out of production and you are going to have to have a reman alternative”

t’s a long way from the farmland of the US in the 19th century to the production of electrical components - but Navistar has been on a big journey. The trucking company’s roots are – literally – in farming machinery. But by the 1980s, times were hard for farmers and the agricultural business was sold. The company was renamed Navistar International Corporation and decided to focus on building trucks, buses and engines. Times have not only changed for the company as an OEM. Navistar executives also see remanufacturing as a key area of interest now and in the future - and in particular they are looking at growth in the reman of electronic components.

validate, and which components need to be replaced during the remanufacturing process.” The company recently announced a rebranding of its existing reman operation, ReNEWed, and has pledged to add several new product lines this year, starting with the 2015 N13 engine and the 2010-2016 engine - as well as expanding the portfolio of reman electronic components such as engine control modules, instrument clusters and body controllers. “These are products that are at the right point in their life cycles and are ready to be launched into the market,” Ongkobudidjojo says. In the past Navistar was not focused on reman electronics “but now there is a lot of opportunity”.

Supplemental offering Electronics expansion To prepare for that, Robert Ongkobudidjojo, Navistar’s manager of reman product development, explains that two years ago the company expanded its reman resources. “We hired more engineers especially on the electronics side. We have people who have been working on reman electronics so they understand which components we can reclaim, which components we can

TJ O’Hanlon, director of private label brands at Navistar, explained that part of the strategy for the ReNEWed line is to expand the company’s reach. “We understand that the first owner of the vehicle is going to come back and buy a genuine OE product [when they need a replacement part], but as the truck gets traded it is important for us to come up with a supplemental offering essentially at a lower price for the second and third

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owner. That is where the reman product line fits in.” One common theme for many of the products being launched, according to Mark Reiter, Navistar’s vice president of product support, is the fact that the truck or the engine that these are replacement components for are no longer in production. “In some respects remanufacturing is a necessity because the suppliers of those components have moved on and are no longer supplying the products for production,” he adds. Being an OEM gives Navistar an advantage when it comes to reman, Reiter continues. “We know what was wrong with those products [during their life]. We know all the failure modes so Robert and his team address those issues in the reman operation. In some ways the ReNEWed products are better than new.” He explains that having a reman option fits into the company’s ‘good-better-best’ strategy. Sometimes a customer’s decision to go with reman is based on cost and sometimes it is more the fact that they want the product to be more like OE and will therefore go with a like-for-like replacement: “In all cases, we provide the options we think will keep the customer in the Navistar family.” ReMaTecNews

➤

COMPANY PROFILE: NAVISTAR

“We want to start to get into remanufacturing components for our competitors’ vehicles. That potentially presents some challenges for us”

Mark Reiter

➤ Life blood

Historically, cores have been a problem area in any reman operation even though they are key to its success. Ongkobudidjojo says: “Cores are the life blood of remanufacturing, and Navistar has done a good job holding on to cores.” In 2016 the company launched its Core Advantage Program, which has allowed the company to complete the buyback of 1,100 vehicles. According to Reiter, Navistar addresses the core issue from first production of a product: “As part of the product development process we plan what the core is going to look like and we strategically apply core charges then to make sure that there is a benefit to return the core to us so we can deliver highquality remanufactured products.” The reman team is particularly proud of its work with diesel particulate filters (DPF). “When we launched our DPF reman programme, it was the first in the industry,” Ongkobudidjojo explains. “That was a big accomplishment for us.” Reiter believes that aftertreatment components like diesel oxidation catalysts and DPFs are some of the fastest-growing parts categories in the aftermarket, although they “didn’t exist eight to ten years ago”.

DPF alternatives He adds: “We really had to adapt and make changes in order to be able to supply them. Eventually DPFs are going to go out of production and you are going to have to have a reman alternative.” Ongkobudidjojo says Navistar is in a good position to capture that business because it owns the calibration of the proprietary components, has the resources to validate

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Robert Ongkobudidjojo them and has the testing facilities to ensure quality. As for the future, Reiter is optimistic. “We have grown in double digits for several years in a row now and we have plans to introduce more products, more components that are falling into the sweet spot of their product life cycle and would therefore qualify for reman. We plan to keep up our efforts and achieve double digit growth for each of the next five years.” However, the future will not be without its challenges. Ongkobudidjojo believes at this point that there is enough demand out there for reman. “Looking ahead, everyone is interested in electric vehicles and if the industry switches to electric vehicles the challenge is ‘can we remanufacture and can we repurpose batteries?’”

Another area of focus for the future is in the all-makes reman space with the company’s Fleetrite brand. “We want to start to get into remanufacturing components for our competitors’ vehicles,” O’Hanlon said. “That potentially presents some challenges for us. One of the things we say with ReNEWed is that we have a team of engineers that have expertise with our vehicles. When we get into our competitors’ vehicles we don’t have all [the product] information.” The company will have to rely for data on its own supply base as well as Ongkobudidjojo’s development engineers to ensure the quality of all-makes reman products is good enough. But no matter what the future holds, O’Hanlon concludes: “The reman brand has been around since 1951.” Sounds like Navistar is staying in it for the long haul.

Timeline: Navistar 1902 International Harvester Company founded following merger of McCormick Harvesting Machine Company and Deering Harvester Company 1986 Navistar International Corporation is formed 1987 Thousand Series truck line launched 2004 First commercial diesel/electric hybrid on the market, the 4000 Series Hybrid, introduced 2009 LoneStar heavy truck is unveiled 2012 Navistar and Anhui Jianghuai Automobile Co receive Chinese government approval for joint venture 2018 ReNEWed remanufacturing brand is relaunched

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GLOBAL REMANUFACTURING DAY 2018

Caterpillar

Tureal

Autocraft SKF

One day in your life By bringing together remanufacturing companies and the general public, the first Global Remanufacturing Day has set the standard for the celebration of reman in future years here did not seem to be anything particularly special about the second Thursday in April this year. But it’s just possible that we will look back and realise this was the day when remanufacturing started to gain wider public acceptance. The Remanufacturing Industries Council (RIC)’s first Global Remanufacturing Day was about getting the word out to the general public about the benefits of remanufacturing. All over the globe, reman companies held events which celebrated the benefits of remanufactured products – and encouraged the outside world to come in and see what all the fuss was about. If reman is going to gain real traction, then everyone – from schoolchildren to policy makers – must have a clear idea of why it is important: in economic, social and environmental terms.

business development manager at Cat Reman. “This day was an opportunity to acknowledge the work and people who are responsible for the success of this growing industry.” According to RIC figures, 127 locations registered Reman Day events, and it was celebrated in 17 countries “on all six inhabited continents”. Moreover, in the US, eight states and one city – Augusta, Georgia - issued proclamations declaring that April 12, 2018 was indeed Reman Day. “We were not surprised to see the diversity among reman sectors participating in Reman Day,” the RIC said in a statement. “Our members and our reman association alliance partners were instrumental in bringing together this growing industry to advocate, collaborate, educate and in this case celebrate remanufacturing. We are looking forward to many more participants in next year’s Reman Day on April 11, 2019.”

Good feedback The initiative was organised by the RIC and embraced by several industry organisations and companies which hosted their own events. “The RIC was proud to collaborate with our partner associations to organise the first ever Global Reman Day,” says John Disharoon, RIC board chair and

Local approach RIC decided that educating those outside the industry would be best executed at a local level, with reman companies hosting students, teachers, parents, job seekers and other local community members at open houses, plant tours and presentations designed to showcase the

economic and environmental benefits of remanufacturing. The approach of America’s Remanufacturing Company (ARC) – a reverse logistics and reman solutions firm servicing OEMs, distributors and retailers – was typical. At its corporate office in Augusta, its celebration focused on educating local community members on the value of reman, its importance to the circular economy and the role it plays in environmental stewardship. The many other entities involved included: Golisano Institute of Sustainability, Caterpillar, Nokia Poland, SKF Österreich, Solar Turbines, John Deere and Tureal Steering Solutions. For fun - but with a serious intention - the ReMaTec team produced a remanthemed Spotify playlist of 36 cover songs ‘that were better than the originals’, and sparked a lot of debate*. Yet however you choose to do it, increasing public awareness of remanufacturing is vital if the industry is to flourish in future. Emphasising the importance of reman for the world’s economy – and for the environment – is a sensible way of ensuring that this will happen. So here’s to next year, when Reman Day takes place on April 11, 2019. Get it in your diary. www.remanday.org

*How Jeff Buckley’s version of Hallelujah got on there is a mystery. John Cale’s is much better

ReMaTecNews

BATTERY REMAN

Batteries not included With sales of electric vehicles gathering pace, the automotive reman sector is checking out new opportunities. But, as Andrew Stone finds, remanufacturing batteries may not be that easy...

low off the starting line, the global electric vehicle (EV) sector is now starting to accelerate into the mass market. In the US, production of Tesla’s model 3 - set to be the world’s first ‘affordable’ mass-market, long-range EV - looks to be hitting its stride after initial teething problems. In China, meanwhile, the electro-mobility revolution is in full swing with hundreds of thousands of electric cars, trucks and buses now rolling off production lines annually. As the global EV vehicle parc grows, (it is set to reach 2.6 million in 2020, according to Navigant Research) so should the remanufacturing opportunities. In theory, EVs could offer significant scope for reman since they can be designed from the ground up with modern circular economy objectives in mind.

And it is batteries, representing up to 40% of the value of an EV, that will offer much of the potential for reman. There could be 11 million tonnes of used EV batteries by 2030, according to an estimate from Canadian battery recycling startup Li-Cycle. Perhaps the best-known - and, in terms of media coverage, certainly the most colourful - name in this nascent industry is Tesla. The company’s long-professed aim to create a ‘closed loop’ battery process - together with China’s recent legislation mandating EV battery recycling or reuse by August 2018 - suggest it is just a matter of time before a big market in EV battery remanufacturing, reuse and recycling takes off. There is some evidence of activity in this regard. Mercedes-Benz is building a $91m remanufacturing plant in Shanghai with a

focus that will include EVs, while leading Chinese EV maker BYD has announced plans to open an EV recycling centre. The economics of remanufacturing are yet to be established but there are some clues when it comes to re-use. In Japan, 4R Energy Corporation, a Nissan and Sumitomo Corp JV (joint venture), will reassemble a few hundred battery modules annually from the first-generation Nissan Leaf, where the used pack’s overall energy capacity has fallen below 80%. It will sell them for $2,855.51, roughly half the price of brand-new replacement batteries.

Repurposing costs Battery repurposing costs, meanwhile, can be as low as US$20/kWh, according to the 2017 paper Repurposing Used Electric Car Batteries: A Review of Options (Journal of the Minerals, Metals and Materials

Reman potential

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BATTERY REMAN

Future promise: in theory, EVs could offer significant scope for reman

Reuse and recycling

Society, Mikaela DeRousseau et al). So this would mean, theoretically, that a 40kWh capacity battery pack you could expect to see in the current ‘longer’ range Renault or Nissan models might be as low as $800 to repurpose - for example for use as a stationary battery pack used to store power from solar panels. Another study, Second Life for PlugIn Vehicle Batteries by the University of California, Davis Plug-In Hybrid & Electric Vehicle Research Center, estimated repurposing costs for several different sizes and models of plug-in electric vehicle battery packs, including a Chevy Volt pack ($1,150) and a Nissan Leaf pack ($1,780) far lower than their original prices. Despite all this potential and the apparently advanced activity underway, a viable EV and battery remanufacturing and reuse market right now seems a long way from emerging. The immediate problem is the lack of used battery packs in circulation, preventing any sort of remanufacturing or repurposing activity from taking place at scale. As the number of used packs increases there are further problems. The business model is as yet unclear since cost-effective processes required for remanufacturing

As well as their potential for remanufacture, batteries can also be repurposed and a variety of approaches are being trialled. Nissan UK has partnered with power management firm Eaton to re-use its packs for home energy storage and in Japan it is running a pilot which employs used EV packs to power streetlights. BMW and Vattenfall are exploring their potential to store solar energy at EV charging stations. Others, such as UK startup Aceleron, are exploring the potential for re-use of individual cells in e-bikes and as replacements for 12-Volt battery packs. Repurposing may be the most economic use case right now, according to figures from Bloomberg New Energy Finance: 95 gigawatt-hours (GWh) of used lithium-ion batteries will hit the

are very far from being realised. It is even rumoured that one EV manufacturer is simply storing its used packs with no plan yet for what to do with them.

Manual challenges The challenges are numerous. Remanufacturing of modern EV battery packs is currently manual, a laborious, time-consuming, costly process involving toxic and flammable materials together

market by 2025 and of these 26 GWh will be converted to stationary battery systems. (For context, Tesla’s Nevada gigafactory will eventually produce 35 GWh of batteries a year, enough for 500,000 electric cars annually). The other potential route for old packs is recycling, which is a resourceintensive and laborious process, costing in the region of €1 per kilo - more than the value of the raw materials. Tesla has claimed, however, that its historical efforts to recycle the battery pack of its debut model the Roadster with its partner Umicore at least have been profitable. How economic battery pack recycling will be for its current models will be anyone’s guess until the manufacturer shares more information about the forthcoming recycling operation at its gigafactory.

with high voltage hazards. The issue of liability may also make OEMs reluctant to release their packs for re-use to third parties, according to a 2016 study, Evaluation of a Remanufacturing for Lithium Ion Batteries from Electric Cars, led by Aachen University. The solution, the study notes, lies largely in the packs being designed in the first place with remanufacture and re-use in mind: “A holistic design of the

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ReMaTecNews

➤

BATTERY REMAN

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components, which considers modularity, interfaces and disassembly, is required. Synchronised components of the module, the cell bracing and wiring and housing is the first key to a remanufacturing able design.” Unfortunately there is little evidence packs are being designed this way and no standardised remanufacturing process yet exists that could take advantage of such designs. Indeed this is a topic addressed in a 2017 paper. Called Development of a novel remanufacturing architecture for lithium-ion battery packs (Lienemann et al, Aachen University), the paper proposes a “remanufacturing architecture, which can handle a capacity of 5,000 up to 20,000 battery packs per year, depending on the selected degree of automation”. The challenges in achieving a standardised - let alone automated process are substantial. The uncertain quality of individual used battery packs and the variety of types (see box, Packaging EV power) and chemistries is one barrier to developing standardised and automated remanufacturing or reuse. Their varying quality matters too. The percentage of original energy capacity, which degrades over time, varies massively. Heat management systems also differ widely.

Open data Data from battery management systems that can reveal how well looked after the packs were - and their existing health status - is another factor. Making such data openly available may be necessary in order to make battery remanufacture and reuse viable, suggests the Scottish Institute for Remanufacture. Vertically integrated Tesla, with its

“The only remanufacturing I see Elon Musk doing right now is of his rocket boosters,” jokes Craig van Batenburg ambitions for a closed-loop battery life cycle, might be expected to be leading the way in overcoming these barriers. Yet it remains tight-lipped about the state of its remanufacturing operations in general. When it comes to its batteries, the role and ambition of its remanufacturing operation (thought to number anywhere from 40 to 130 employees) is unclear. At the time of going to press, the manufacturer had not been able to respond to ReMaTecNews’ requests for information on its remanufacturing and recycling processes. But there certainly seems to be movement: although details are sparse, Redwood Materials, a start-up linked to two top Tesla Motors executives, JB Straubel and Andrew Stevenson, claims to be developing advanced recycling and remanufacturing technology.

Potential concerns If anything, there are concerns that Tesla has barely started thinking about

Packaging EV power No common standard has yet emerged for the form factor and packaging of battery cells or of those cells into packs. Tesla is unusual in that it has opted for cylindrical cells (they look like standard AA batteries but bigger), which are well established in mass manufacture and widely used in laptops. There are thousands of these in each EV battery pack and each must be housed and wired in place. Prismatic (boxy, rectangular) cells and

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pouch-style cells are more common in EVs and come in an array of sizes and capacities. Prismatic and pouch cells offer flexibility in the design of a pack and have potentially higher energy density by weight than cylindrical cells but are harder to prevent from overheating. Remanufacturing is likely to remain highly specialised and seems likely to resist any kind of automation until a common form factor and packaging process emerges.

the potential for remanufacturing its battery packs. The early evidence is that remanufacturing of Tesla’s packs will be far from straightforward. A spring 2018 teardown of the Model 3 by Munro Associates praised the sophistication and quality of the vehicle’s pack - but noted the lack of any apparent thought for disassembly either for remanufacturing or for easy recycling. Craig van Batenburg, from the Auto Career Development Centre in the US, agrees there is little evidence Tesla has ‘designed in’ reman capabilities. The battery pack design seems to have moved on very little since his own teardown of an older Model S battery pack. “It was moulded in a clear case with plenty of black plastic and glue. You had to cut and smash it to get the cells out,” says van Batenburg. “The wiring was well designed from a power and safety standpoint but not from a rebuildable design standpoint, by any means.”

Unclear future He remains to be convinced about the scope or ambition of Tesla’s remanufacturing efforts in general, which might be thought to compare poorly with those in Tesla CEO and chairman Elon Musk’s other main venture, Spacex. “The only remanufacturing I see Elon Musk doing right now is of his rocket boosters,” jokes van Batenburg. With global EV sales expected to account for a quarter of new car sales as soon as 2030 and more than half by 2040, according to Bloomberg New Energy Finance forecasts, it seems likely a significant new remanufacturing market is taking shape. But how it takes shape is unclear. At present it seems likely that the least degraded used packs might be reassembled for reuse in EVs, while the older ones will be re-purposed and the rest recycled. Much depends on packs being made with remanufacturing in mind - not something the automotive world seems to have devoted much effort towards so far. Establishing automated or at least semi-automated pack remanufacture processes is another target - and a moving target, too. As the prices of new battery packs continue to fall (and they are so far falling faster than many had predicted), the challenge is to establish a battery remanufacture business model that will endure.

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TURBOCHARGERS

Turbo power BorgWarner has set up a dedicated reman facility in a small city in south-east Poland. Adam Hill went to see what attracted the multinational turbocharger giant to Rzeszów

here are many reasons why companies choose to locate their operations where they do, from ease of trade to simplicity of communications. BorgWarner looked at a variety of places for its dedicated remanufacturing facility before deciding on Rzeszów in south-east Poland. The impressive, new 5,000 m2 plant has 2,000 m2 devoted to reman. There are a variety of reasons for choosing Rzeszów, explains Ian Buxcey, BorgWarner’s global remanufacturing manager. Apart from Poland’s geographical position handily located between eastern and western Europe - Rzeszów is a city of nearly 200,000 people. This provides a local, skilled, motivated labour force, and many of BorgWarner’s employees have graduated from the highly-regarded Rzeszów University of Technology. There is also an international airport and excellent road transport infrastructure, which means that getting people and goods in and out is straightforward.

Material flow When ReMaTecNews visits the plant, large digital display boards throughout the BorgWarner campus carry the number ‘932’. “That’s the number of days without accidents,” says Buxcey (far left). The UKbased veteran of the reman industry was entrusted by BorgWarner with overseeing the building of the reman facility from scratch and effectively commutes from his home in England’s Midlands. The safety record is something that the company takes very seriously – and of which it is extremely proud. On a tour of the Rzeszów facility, Tomasz Lukaszek (above left, in glasses), operations manager, remanufacturing at BorgWarner, explains: “We receive the cores from customers, either IAM [independent aftermarket] or OES [original equipment supplier] and we decide what we can and cannot remanufacture.” Material flow is carefully handled, from Email your comments and stories to editorial@rematecnews.com

core processing to sorting to disassembly in the early stages. Cleaning is critical, says Lukaszek: “It determines what we do afterwards – should we blast it, polish it, and so on.” The facility’s wash plant had to be specially constructed. “One turbocharger is 38kg,” explains Buxcey. “Put six or seven of them into a basket and the weight of craning has to be factored in.”

Extensive range After cleaning comes machining, core assembly and final assembly, before the final step: packaging. The company has had zero warranty returns so far – not bad for an operation which currently produces around 5,000 reman turbochargers per month and produced its first reman turbo in August 2016. BorgWarner also makes two million new turbochargers per year at Rzeszów and plans for that to rise to three million by the start of 2019. This is an impressive output on both scores. On the BorgWarner site is an extensive range of laboratories and test facilities, conducting research on a range of issues, supporting the business and contributing – among other things – to the reman function’s ability to see how other manufacturers have made their products. “BorgWarner has a reverse engineering capability, checking the dimensions and material composition of the original part,” says Buxcey. In reman, it is important to know the effect of corrosion after cleaning – and the labs also give the company the chance to do this. “That’s the advantage we have here,” he goes on. BorgWarner already remanufactures third-party products in Brazil and the US, so could the future see an ‘allmakes’ policy come into force in Poland? Time will tell. “We only remanufacture BorgWarner at Rzeszów at the moment,” Buxcey concludes. “We have enough of our own to keep the growth pattern going, without overcomplicating it with other people’s. We will consider this in the future, but not yet.” ReMaTecNews

CHINA REMAN

THE WALL HAS FALLEN – now someone tell the customers On the face of it, the Chinese government’s decision to lift restrictions on using reman products for warranty repairs looks set to boost the industry - but things may not be that simple, finds ReMaTecNews’ Asia-Pacific correspondent Tim Maughan. And not least of the potential issues is the lack of cores…

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CHINA REMAN

p until the end of 2017, the Chinese remanufacturing industry was shackled: China’s government prohibited automotive companies from using reman products for warranty repairs within their specified warranty periods. Not any longer: the National Development and Reform Commission (NDRC) lifted the restrictions on January 1 this year to general optimism from remanufacturers. Given the vastness of China, and its hundreds of millions of consumers, this decision - at least on paper - potentially opens up prodigious reman opportunities. But it is a complex issue. In China, reman still suffers from something of an identity problem. “Traditionally, [Chinese] people don’t trust a remanufactured product,” says Dr Yan Wang, senior lecturer, mechanical and manufacturing engineering at Brighton University. “They don’t trust the quality. Their belief is that it is not as good as a new product. Remanufacturing was only used for the after-warranty period.”

bystanders, he suggests. “Now, they know it is going to change. I perceive that lots of the remanufacturers will start their business with OEMs. In the past few years, several remanufacturers have started [launching businesses in China].”

Warranty restriction

Image problem This suggests that reman opportunities post-warranty period deregulation in China are, in theory at least, boundless. That said, the image of reman in China is another significant obstacle, Wang reiterates. Often, the industry is viewed with some scepticism: “I think it’s the same everywhere - in the UK, Japan, and China. The quality is there but people don’t trust it, although it is the same quality. I don’t think this will change in a short period.” Added to this is a more basic problem: cores. These vital building blocks needed to sustain, and service, a solid reman industry - are not yet in place in China. “The big barrier to remanufacturing in China is that they don’t have enough cores,” continues Wang. “They have the capability, but they don’t have enough capacity. They don’t have enough cores to make a full benefit from the mass production, and the cost benefits.” Without minimising the challenges ahead, others believe that the government’s decision on warranties may lead to the expansion of the sector. “This move forward could be the great change,” says Wayne Yao, head of remanufacturing at consulting company Duxes. Before the warranty restrictions were lifted, remanufacturers were to some extent

“For our industry, heavy duty and commercial engine manufacturers, there is not a big change. As I estimate, from the Chinese market, the question is if the end customer will accept this” CLEMENS ORTGIES

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But, he acknowledges, it will still not be easy to start with. “Their business capacity, or the market, is still quite little mostly due to the restriction of the reuse of reman in the warranty period,” Yao concludes. But this can change, he thinks. Dr Yan Wang believes that the basics are still not right - and that this will stop reman in China from flourishing - at least in the short term. “You increase the cores, then you increase the market,” she says. “Once you increase the market, you increase the demand for remanufacture.” Perception and cores issues aside, the Chinese government seems committed to remanufacturing in the long term - and this is essential to the sector’s growth. “They are very keen to develop the policy,” says Wang. Indeed, China aims to become the largest reman nation in the world, and has laid down a series of fiveyear plans designed to bring this vision about. A paper entitled Remanufacturing Mission to China, sponsored by the British Foreign & Commonwealth Office, identifies the obstacles which confront reman in China.

Reman obstacles She points out that China wants reman growth to spread from staples like the automotive and mining sectors, the machine tool and petrochemical businesses, to new industries like aero engines and gas turbines. But this process, says her report, is hindered by the over-production of new parts, a lack of new business models, and sometimes ineffective supply chain management. While the NDRC decision seems to offer huge, rich pickings, it must be remembered that the reman supply chain is long. To capitalise on deregulation, all parties in the chain need to recognise the strengths and opportunities reman offers. Clemens Ortgies, who runs YC Europe, an industrial engine maker, explains that the largest shareholder in his firm is Chinese company Guangxi Yuchai Machinery Co. He is also president of the International Organisation of Engine Remanufacturing. “We are the biggest producer of heavy ➤ ReMaTecNews

CHINA REMAN

➤ duty engines in China,” he says. “Diesel

engines for light commercial vehicles, and heavy duty commercial vehicles, as well as marine engines and industrial engines.” But the new reman rules in the warranty period, he explains, do not seem to have a serious significance in his market. “It is not a big issue for us, because we think that the Chinese customer more or less decides if he wants to take a reman part, or not,” Ortgies suggests. “For our industry, heavy duty and commercial engine manufacturers, there is not a big change. As I estimate, from the Chinese market, the question is if the end customer will accept this.”

“They have the capability, but they don’t have enough capacity. They don’t have enough cores to make a full benefit from the mass production, and the cost benefits” YAN WANG

Like Wang, Ortgies stresses that there is a reluctance to accept remanufactured products in China, especially under warranty schedules. That said, there has been more of a willingness to embrace aftermarket remanufacturing, he explains. “I think the change will not be big, because it is the customer who decides. Maybe it is image, maybe it is the Chinese attitude - I don’t know,” Ortgies says. “In China, it is more related to the dealer network, which has to handle all these issues. They have to deal with the spare parts companies, and with the OEs. I think they will take what the OEs are offering.” There is no doubt that things are changing in China. Most eye-catchingly, in March the country’s leader Xi Jinping was in effect given leave to remain in office indefinitely after term limits for presidents were scrapped. During recent meetings in China, the European Remanufacturing Council (CER), signed memoranda of understanding in Hebei Province with the new National Demonstration Base for Remanufacturing. David Fitzsimons, director of the CER, told ReMaTecNews: “A large number of reforms were agreed during March, to propel the Chinese economy along a different development path – less speed and more quality. This is why China is closing off imports of recyclable materials from plastics to crushed car bodies, whilst amending product rules to promote remanufacturing. I sense that Western media and companies noticed the change in President Xi’s terms of office but not the opportunities being opened up by the change in direction.”

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The Great Wall of China: reman restrictions are down – but barriers remain

Embracing aftermarket

“A large number of reforms were agreed during March, to propel the Chinese economy along a different development path – less speed and more quality” DAVID FITZSIMONS

Economic development The new cluster for remanufacturing will be at the heart of a massive economic development zone designed to relieve pressure on Beijing, Fitzsimons goes on. This means that companies wishing to sell into the Chinese market might consider how to blend manufacture with remanufacture, by having an in-house line or by appointing an approved third party. “Why?” Fitzsimons concludes. “This choice will accelerate sales development and give them access to the new support facilities.” Whichever way you cut it, there

will be opportunities arising from the government’s change of policy on reman products. But caution is understandable when it comes to the scale of those opportunities, and the timescale in which they will arise, for the reasons laid out above - primarily the relative absence of cores and the perception of reman products in China and other markets. Nonetheless, the invisible ‘Great Wall of China’ which prevented the use of reman products for warranty repairs has been breached - now someone has to convince the customers that reman is worth paying for.

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APRA Europe moves to the next level Chairman Daniel Koehler announced his strategy for APRA Europe during this year’s APRA European Symposium in Budapest. A key element is the establishment of APRA Ambassadors for distinct countries

“If we consider aftermarket sizes across European countries and compare them with our member structure, we see huge potential for growth and development,” stated Dr Daniel Koehler, chairman of APRA Europe during the APRA European Symposium. This took place in April at the Hotel SOFITEL in Budapest, Hungary, where European remanufacturing experts met and discussed the current issues and future trends of our business. “In order to realise this potential, I came up with a clear chairman’s strategy which I based on analysing the current positioning of APRA Europe as well as questioning member value,” Koehler continued. His strategy consists of five key elements which will be put into practice step by step: 1. Member services and operations (install and enforce) 2. Value proposition to members (define, optimise and communicate) 3. APRA Europe legal entity (install, deploy and start operations) 4. Member and customer visibility (enforce) 5. Localisation strategy (define and deploy)

“The most remarkable part of my strategy, however, is the localisation strategy which includes the designation of APRA Ambassadors” Dr Daniel Koehler

The graph shows the membership growth potential of APRA Europe in five countries, based on a comparison with the actual aftermarket size

prospective members, APRA Europe recently installed its first social media presence on LinkedIn and there is more to come, explains Koehler. “The most remarkable part of my strategy, however, is the localisation strategy which includes the designation of APRA Ambassadors,” he said. “These Ambassadors will represent APRA Europe in their home countries and will be the initial contact for any remanufacturing-related company. With the Ambassadors I want to overcome language and cultural barriers - and by this I want APRA Europe to be closer to its existing and prospective members, irrespective of company size, location and language. In the end we actually aim on becoming more European than we are already by reflecting the broad diversity of Europe in APRA.” Koehler concluded that he and APRA Europe will get moving and implement the strategy, the next level of which can be expected in early 2019. By then, all elements of the strategy should be fully operational and the Ambassadors should be about to start their work.

100% 90%

“We are not just talking but also doing,” he went on. “So, we have already started with the implementation of the strategy: for example, the member services and operations we have already 100% established and the value proposition is also completed and just gets a fine tuning after member feedback of our successful symposium in Budapest.” APRA Europe is also about to found a European legal entity – element number three of the strategy - which has been announced in ReMaTecNews previously. In order to improve visibility in the automotive aftermarket, the remanufacturing industry and among

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+194% 80% +153% 70%

+32%

60% 50%

+330%

40% 30% 20% 10% 0% Germany

Italy

Aftermarket (normalised)

France

United Kingdom

Spain

Members (normalised)

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PARTS2CLEAN International trade fair for industrial parts and surface cleaning, covering a range of products and sectors. Stuttgart, Germany

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Multiplying is better than just adding We can all do more for the remanufacturing sector if we are prepared to work together, says Volker Schittenhelm. And look at the success that collaboration has already brought to the industry…

Oriental wisdom says: working alone means ‘adding’ - but collaborating means ‘multiplying’. That is the original sense and purpose of every federation. And it is more or less practised by the national members of FIRM and also among FIRM members themselves - otherwise, our activities would not have led to success. Meanwhile, collaboration has reached a second level: FIRM has global connections with engine reman associations in New Zealand, South African, Brazil and North America. And that’s not all. With regard to automotive remanufacturing, FIRM works very closely with APRA Europe (through lobbying activities and through its relationship with ReMaTec, et cetera), and thus with APRA in general. Even China is part of our network. That has led to the success of publishing our automotive reman definitions two years ago - and also to a general understanding of automotive reman at political level.

New targets But it is very important to have new targets on the screen and to match them! Our industry must sit down and tie up the package of wishes that we have with the list of possibilities that the politicians can help us with. From FIRM’s side, the wish list looks as follows (not just focused on engine reman, and in no particular order): 1. Promote existing automotive reman definition and extend to nonautomotive industries 2. Tax reduction for reman products 3. Alignment of the so-called ‘core tax’ (add-on, flat rate tax for remanufactured products) in the European Union - or, better still, abolition of that tax to create global reman competitiveness 4. Establish a job profile of ‘automotive remanufacturer/general remanufacturer’ 5. Support universities to establish remanufacturing degree programmes

6. Evaluate ‘information package reman’ that helps market participants, especially smaller companies, to get financial support - especially from investors 7. Highlight intellectual property issues relating to remanufacturing that need to be resolved, e.g. remanufactured items containing patented components and brand names of OEMs that have been remanufactured by a third party 8. Funding 9. Reman quotas instead of existing recycling quotas in the framework of the end-of-life vehicle guideline 10. Design4Reman: products should be designed and produced in a way to easier reman at the end of their first life cycle 11. Reman products to be regarded as good as new parts and not as ‘used’ The next challenge is to match all our wish lists and promote them in Brussels.

Circular economy

Industry Reman

Aerospace reman

Windpower reman

Engine reman

Medical healthcare reman

Automotive remanufacturing

Toner & cartridge reman

But take this into consideration: more and more specialists and media are speaking about the circular economy where automotive reman is just one big part among other segments like industrial reman, IT, aerospace, wind power, medical healthcare, toner & cartridges, and so on. Our industry and its representatives and lobbyists must discuss and decide whether to speak with an automotive reman voice (covering engine reman) or whether it would be better with the ‘circular economy’ voice, where the automotive reman industry could contribute big figures on turnover, employment and CO2 reduction. Do we have a chance to match all our activities? Should we add - or multiply?

IT reman

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