Why scrap car prices change

A price you saw last month, or on a list from another city, is a snapshot. Here’s what makes it go stale, and how that feeds into what sets a scrap car offer here.

What a scrap car is made of

Automobiles are about 65% steel and iron by weight, according to the Wikipedia summary of scrap recycling. That’s the ferrous part: it sticks to a magnet. The rest is a mix of glass, rubber, plastic, fluids and non-ferrous metals such as aluminum and copper.

So when someone quotes a scrap car, they’re mostly quoting steel.

Who buys the steel

Steel mills. Once a car has been drained, stripped, crushed and shredded, the steel is separated out and sold by the ton to mills that melt it into new steel. The vehicle recycling article puts the scale plainly: end-of-life vehicles give the steel industry more than 14 million tons of steel a year.

The US Geological Survey says the same thing from the mill side. In its iron and steel scrap overview, it notes that US steelmakers and foundries are “highly dependent upon the ready availability of scrap” and that “the primary source of obsolete steel is the automobile.”

Northwest Indiana knows this better than most places. Gary grew up around U.S. Steel’s Gary Works, and East Chicago is home to the Indiana Harbor Works. That’s the industry a scrap car ultimately feeds. It doesn’t mean your car goes to either mill, and it doesn’t set a special local price. Mill demand is the market everyone’s scrap price hangs from.

Steel moves, copper and aluminum move more

Scrap metals split into two families. Ferrous metals, iron and steel, are cheaper per pound and traded in huge volumes. Non-ferrous metals like copper, aluminum and brass are worth more per pound, and their prices “tend to fluctuate more” than ferrous metals, per the same scrap article.

For a scrap car that’s mostly steel, the swings are usually gentler than the headlines about copper. But they’re real, and a buyer’s per-ton rate for whole cars follows them.

Local costs sit on top

The market sets the base. Then come the local costs of turning your car into steel a mill will buy:

• Getting it. Towing time and distance. Ours is free to you, but it’s still part of what a buyer weighs.
• Getting at it. A car behind a locked gate, in a garage or on a narrow side street takes longer to load.
• Getting it ready. Draining fluids and removing the parts that can’t go through a shredder.
• What’s there. A complete car weighs more than one missing its engine or wheels.

Two buyers on the same day can quote differently because their costs differ, even when the market is the same.

Why quotes are time-limited

Because the rate underneath them changes. A buyer who quotes you today is using today’s rate for whole cars. If you wait a month, the rate may have moved, and so will the offer. That isn’t a trick. It’s the same reason a quote for anything priced off a commodity comes with a date.

It works both ways. If prices have dipped since a friend sold their car, your offer may be lower than theirs for the same model. If they’ve risen, it may be higher.

How to read a price you see online

Wikipedia’s scrap article warns that “prices displayed as the market prices are not the prices that recyclers will see at the scrap yards.” Before you trust a number, check:

1. The date. An undated price is a guess about the past.
2. The unit. Per gross ton (2,240 lb) or per net ton (2,000 lb)? See gross ton vs net ton.
3. What it’s for. Complete cars, or a sorted steel grade? They’re priced differently.
4. What it leaves out. Towing, and deductions for missing parts.

Then ask for a real offer on your own car. Send the details and we’ll call back with today’s number, towing included.