Remanufacturing: The spring breeze of leveraging the policy is about to realize profitability

On June 7, Yang Chunping, director of the Research Center for Circular Economy of the Institute of Economic System and Management of the National Development and Reform Commission, disclosed that the National Twelfth Five-Year Plan for the Development of Recycling Economy will be announced. By 2020, the environmental protection industry will become a pillar industry of China's national economy. . Not long ago, the Ministry of Industry and Information Technology announced the second batch of remanufactured product catalogs, among which 35 products of 4 categories, including Sany Heavy Industry, Caterpillar, and Wuhan Maxima, are listed. It can be seen that the energy-saving and emission-reduction business has risen to the national strategic height, and these companies entering the catalog will be expected to receive policy support in terms of taxation and credit, thus accelerating the pace of the remanufacturing industry.

Remanufacturing refers to the mass production process that professionally rehabilitates used Auto Parts , construction machinery, machine tools, etc. Compared with manufacturing new products, remanufacturing can save energy by 60% and save material by 70%. With a cost saving of 50%, almost no solid waste is produced, and the emission of atmospheric pollutants is reduced by more than 80%. Therefore, remanufacturing not only can obtain good economic benefits, but also can obtain incalculable environmental and social benefits.

According to report, the current value of global remanufacturing is more than US$100 billion, and about 75% comes from the United States. The remanufacturing of automobiles and construction machinery accounts for more than two-thirds of the total. As the world’s largest construction machinery market, China’s 14 major aircrafts The number of types of construction machinery reached 2.9 million units, and nearly 80% of the in-service construction machinery will soon exceed the shelf life. If these equipments are put into the remanufacturing field, at least a market size of US$10 billion will be generated.

Despite the huge market space, Chinese companies entered the remanufacturing field as early as 1995. However, due to various reasons, the previous investment has not been able to be converted into economic benefits. Remanufacturing has therefore become a new industry that only looks “beautiful”. Development has always lagged behind the rapid growth of industrial manufacturing.

Re-manufactured Chinese-style puzzles Since 2010, leading companies in the Chinese construction machinery industry, such as Sany Heavy Industry, Xugong, Liugong, etc., as pilot enterprises for remanufacturing of electromechanical products approved by the Ministry of Industry and Information Technology, have increased investment in the remanufacturing of construction machinery. . However, due to the restrictions of relevant regulations and market maturity, most companies are still in the exploratory stage.

The recycling of old parts is a major problem faced by remanufacturers. According to Article 14 of the State Council's Decree No. 307 issued in June 2001 and still in use today, “the scrapped automobile recycling company dismantles and recycles the scrapped automobiles, five major assemblies (automobile engine, steering gear, transmission, front and rear axle, frame). It should be sold as scrap metal to the steel company as raw material for smelting.” This order makes remanufacturers only purchase old parts from fixed customers or auto repair markets as remanufacturing raw materials, far from meeting production and market demands. In addition, in the Import and Export Regulations of the Chinese Customs, only the Regulations on New Products and Waste Products, there is a lack of corresponding provisions for the “old parts” between the two, and even many people understand that restricting the import of old equipment into the Rubbish enters China, and in this way, the possibility of “remanufacturing” companies gaining blood and growing will be stifled at the source.

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