Auto Recycling eNewsletter

January 2006

Written and published by Mike Gibson and Ron Sturgeon, autosalvageconsultant.com, email to email Mike Gibson

To register for future free issues, visit http://www.autosalvageconsultant.com. Don’t forget to watch for our management articles monthly in Recyclers Power Source Magazine, or posted at our web site.

Recent News

LKQ Corporation Announces Two-for-One Stock Split, Chicago, Dec. 15, 2005, The Auto Channel

LKQ Corporation announced today that its Board of Directors approved a two-for-one split of the Company's common stock. Each stockholder of record at the close of business on January 3, 2006 will receive an additional share for every outstanding share held on the record date, and trading will begin on a split- adjusted basis on January 15, 2006.

LKQ Corporation Acquires Chicago Recycled Auto Parts Facilities, Tuesday December 6, 2005, Chicago, Dec. 6 /PRNewswire-FirstCall/

LKQ Corporation announced that it has acquired A-Reliable Auto Parts and its affiliated companies. A-Reliable is a leading provider of recycled automotive products servicing the greater Chicago area. Terms of the transaction were not disclosed. A-Reliable operates from three locations, two that sell primarily into the retail market and one that sells into the professional repair market. All three facilities are located in the Chicago metropolitan area and increase LKQ's facility footprint by 63 acres that include considerable warehouse space. "Our investment in A-Reliable will complement and expand our service to the whole Chicago market," said Joe Holsten, LKQ's President and Chief Executive Officer. "A-Reliable significantly increases our capacity and ability to service the important collision and mechanical repair markets in one of the nation's largest automotive repair markets, and also provides for our initial entry into retail sales in the greater Chicago area. We expect to expand A-Reliable's penetration into the professional repair market as we incorporate A-Reliable into our business model. In addition, we are highly impressed with the A-Reliable management team, which will continue to operate the Company." A-Reliable's revenue for 2004 was approximately $29.6 million.

Industry Trends Report, Vol. 5, No. 1, Winter 2005, Published by Mitchell International, Inc.

OEM parts represented 71.8% of all parts dollars specified by Mitchell-equipped estimators during the 4th quarter of 2004. Compared to last year at this same time, this data reflects a 2.0-point reduction in the use of OEM part dollars per estimate between these respective periods. Aftermarket sources were 12.2% of all parts dollars listed on Mitchell appraisals during the 4th quarter of 2004, an increase of 1.6 points and a significant 15% from the 4th quarter of 2003. This continues a trend of increased utilization, dating back to the beginning of our Trends reporting period in 2001. Remanufactured parts, currently listed as “Non-New” parts in our estimating platform and reporting products contributed to 4.7% of average gross parts dollars used in appraisals during the 4th quarter of 2004. This reflects a 1.1-point and 30% increase from the 4th quarter of 2003, and supports a trend of increased use from the beginning of our 2001-2004 observation period. LKQ parts constituted 11.3% of the average parts dollars per appraisal during the 4th quarter of 2004, reflecting a 0.7 point and 5.8% decrease from this same period last year. Overall, LKQ part use, as specified by Mitchell estimators, has remained fairly steady at approximately 12% since the beginning of our Trends observation period, from the first quarter of 2001.

How’s Business?

“People with clear, written goals, accomplish far more in a shorter period of time than people without them could ever imagine.” Brian Tracy

AutoSalvageconsultant.com was formed in 2001 to help recyclers improve their businesses. With over 50 years of experience in 3 staff members, the group is THE definitive source for recyclers’ management and training needs. Mike Gibson and Tammy Sturgeon joined the team in 2003, and bring a wealth of experience to the team, plus more resources, as there have been more requests for help than Ron could meet. The founder, Ron Sturgeon is past owner of AAA Small Car World. In 1999, he sold his six Texas locations, with 140 employees, to Greenleaf. In 2001, he founded North Texas Insurance Auction, which he sold to Copart in 2002. In 2002, his book “Salvaging Millions” was published to help small business owners achieve significant success, and was recently reprinted and published in Chinese. In June 2003, he joined the new ownership and management team of GreenLeaf. He also manages his real estate holdings and investments. You can learn more about how to help your business at www.autosalvageconsultant.com. Mike can be reached at 1409 Carson, Haltom City, TX 76117, (preferably) email Mike Gibson, or 817-925-8430.