
A Junkyard Billionaire - yarapavan
https://www.bloomberg.com/news/articles/2019-11-19/junkyard-billionaire-thriving-on-car-wrecks-expands-his-empire
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rmason
Want to see the inside of a Copart yard? There's a guy I follow on YouTube who
buys and repairs cars purchased at Copart and then sells them. He does three
'walk arounds' each week and comments on the cars he finds.

[https://www.youtube.com/watch?v=HGGsYirSZhw](https://www.youtube.com/watch?v=HGGsYirSZhw)

What's interesting is that he ends up making very little on his repaired cars.
But he's so fascinating as he repairs them in his suburban driveway that he's
making $250,000 a year off YouTube. Talk about failing upward! The key is that
he manages to be very entertaining doing it.

~~~
Scoundreller
I really wanted to do the opposite one day:

Part-out a car. The numbers actually looked pretty good. Not for the hours,
but I would learn about every part of a car, outside-in while making money.

I think there’s a sweetspot for parting out though: probably 5 year old cars
because they are worth repairing. May 6-8 year old cars for more luxury
models.

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yarapavan
Context:

Copart specializes in online auctions of cars that are too damaged for
insurance companies to justify paying the price of repairing them; buyers
include scrap yards and companies like LKQ Corp., which dismantles old cars
and reconditions their parts to be sold in collision-repair shops. The
insurance companies get what’s recovered in the auction, minus fees due to
Copart that in some cases will increase proportionally with the value of a
vehicle.

“There was a lot of concern that safety technology would reduce accidents and
so there’d be less cars for auction -- good for society, bad for Copart,” said
Craig Kennison, a senior research analyst at Baird. But that didn’t account
for the spread of smartphones, he added. “Cars may be safer, but drivers are
more distracted.”

Another article from Bloomberg, with more info -
[https://www.bloomberg.com/opinion/articles/2019-11-08/junk-c...](https://www.bloomberg.com/opinion/articles/2019-11-08/junk-
car-dealer-copart-is-pricier-than-apple-and-microsoft-k2qkdw2k)

~~~
cperciva
A lot of that safety technology -- crumple zones, reinforced passenger cages,
airbags, rear view cameras -- make things safer for _people_ but contribute to
increasing the dollar value of vehicle damage. I'd say that the concern was
overstated, quite aside from a supposed increase in smartphone-induced
accidents.

~~~
Scoundreller
And those proximity sensors are expensive.

... but the remaining working ones retain their value really well in the parts
market making the carcass more valuable.

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neonate
[https://outline.com/zXFL9s](https://outline.com/zXFL9s)

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russellbeattie
As we move to electric over the next few decades, I wonder what we're going to
do with all the ICE vehicles that are on the road now? There's going to be a
tipping point where finding a gasoline station will be hard. There are a lot
of gas stations, so this is going to be pretty huge by itself. Some states may
go as far as banning ICE vehicles all together.

I guess we already churn through a huge amount of cars yearly as it is... I
don't see many 1979 Plymouths on the road. They must have been all chopped up
at some point, so this is probably a non issue. That said, I can't imagine the
transition will be without pain for lots of people...

~~~
dokem
Off topic but why does hn use the term ICE vehicle rather than gas vehicle? It
comes across as forced like when a non tech person is trying to impress me
with buzz words and I’m just like no one talks like that in the industry.

~~~
enjeyw
Coming from a country that refers to ‘gas’ as ‘petrol’, ‘gas vehicle’ sounds
far more awkward than ‘ICE vehicle’ - makes me think of a car running on LPG

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ng12
I don't get why the article is treating this as an exciting new business. It's
as old as automobiles are -- every town has a junkyard or two that buys junked
cars for a pittance. If you've had the displeasure of trying to keep a 15 year
old junker running on a limited budget you may have even gone to one of these
yards to source some parts.

What's the innovation here? He has an online platform? He may be really good
at running his junkyards but the article does a terrible job accounting for
his success.

~~~
WalterBright
> trying to keep a 15 year old junker running on a limited budget

My daily driver is 30 years old. My weekly driver is nearly 50 years old. 15
is a new car!

~~~
mdorazio
It's awesome that you're able to maintain your cars well enough to keep them
going that long, but obviously yours are not even close to a normal use case.
200k miles or 12-15 years is average [1] longevity.

[1] [https://www.aarp.org/auto/trends-lifestyle/info-2018/how-
lon...](https://www.aarp.org/auto/trends-lifestyle/info-2018/how-long-do-cars-
last.html)

~~~
WalterBright
> It's awesome that you're able to maintain your cars well enough to keep them
> going that long,

I actually do very little. I'm pretty easy on my cars. A mechanic once told me
he couldn't believe how little wear there was on the clutch for the miles. (I
habitually approximate the right engine speed before letting the clutch out.)

Also, most car mechanical failures come from neglecting lubricating things.

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RickJWagner
The American dream.

I'm a car nut, I really like this guy's story. Lucky dog.

