The situation could arise if the price of scrap metal falls such that the recycling of vehicles to European standards is no longer commercially viable for accredited scrap businesses, experts warn.
” If our contract cannot go on we would have to discuss it with the DTI and other arrangements would have to be put in place.“
– Kathryn Byng, Cartakeback
Under the European End of Live Vehicles (ELV) Directive, MG Rover has the responsibility to offer free take-back services for last owners of MG Rover-branded vehicles from January 7 2007.
The company – which has a 10% market share meaning it could be responsible for more than 200,000 ELVs each year – signed a contract with authorised treatment facility (ATF) network provider Cartakeback Ltd earlier this year to set up MG Rover's free take-back network.
Cartakeback
Following the entering of MG Rover into administration on Friday, Cartakeback is now seeking clarification from administrators PriceWaterhouseCoopers (PwC) on the future of the company's ELVs.
Cartakeback's Kathryn Byng told letsrecycle.com it was too early to say what will happen to MG Rover ELVs, but warned that if the often volatile price of scrap steel drops, “there could be a big problem”.
Ms Byng said: “We are going to contact the administrators – PriceWaterhouseCoopers – shortly and take things from there. If our contract cannot go on we would have to discuss it with the DTI and other arrangements would have to be put in place.
“If nothing else happens the DTI would have to put in any provisions for ELVs of MG Rover,” she added.
DTI
The Department of Trade and Industry, which is currently tied up in negotiations to try to save MG Rover, told letsrecycle.com that under the terms of this year's ELV (Producer Responsibility) Regulations, it could hand responsibility for any “orphan” ELVs to another producer or producers.
A DTI spokesman said: “Under the End of Life Vehicles (Producer Responsibility) Regulations 2005, the Secretary of State may ascribe responsibility for “orphan” ELVs to another producer, if they have grounds for doing so, or may negotiate a collective agreement with manufacturers to deal with such vehicles such that last owners of those orphan ELVs still have their entitlement to free take-back, and that the recycling targets for those vehicles are achieved.”
The spokesman added that accredited vehicle dismantlers could deal with orphan vehicles without being under contract “on a commercial basis”. This would rely on the world price of scrap metal remaining high.
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MG Rover's production line remains silent today, but administrators PwC said it is hopeful of re-opening talks with Chinese firm Shanghai Automotive Industries Corporation of China about Rover's future. MG Rover's parent company, Phoenix Venture Holdings, has now pledged 49m in assets to help the company survive until a buyer has been identified.
Cartakeback Ltd is also working to provide an ATF network for manufacturer Ford, which Ms Byng said was progressing well, adding that the company is in discussions with other manufacturers about their obligations under the ELV Directive.
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