$60k/month Increase in BMW Supplier Scrap Revenue
What do you do when you can't return your scrap to the mill for closed loop recycling?
Problem:
GES, a BMW exclusive Tier 1 supplier in Union, SC, was facing a significant issue at their stamping plant, where they were unable to separate 5X and 6X aluminum scrap due to a lack of necessary technology.
This inability to separate the scrap prevented them from returning the material to the aluminum mill for closed-loop recycling, resulting in lower returns on their scrap material and inefficiencies in their scrap management process.
Solution:
Factory Scrap stepped in to address this challenge by identifying alternative markets for the mixed 5X/6X aluminum scrap. We located facilities in both the US and Mexico that could utilize the mixed material by gradually incorporating it into their furnaces.
This strategic approach not only found a new use for the combined scrap but also optimized the process to fit within the capabilities of these consuming plants.
Outcomes:
As a result of Factory Scrap’s intervention, GES saw a substantial increase in scrap revenue, earning an additional $60,000 per month. Freight costs were also significantly reduced, saving the company $47,000 per month.
Moreover, by eliminating the need for double handling and improving payment terms by 15 days, GES further streamlined their operations. Finally, the establishment of annual index pricing based on the London Metal Market ensured more stable and predictable financial returns.
Conclusion:
Factory Scrap's tailored strategy not only resolved GES's immediate scrap management challenges but also provided long-term financial benefits and process efficiencies. This case study highlights our expertise in scrap marketing and process optimization, delivering measurable value to our clients in the automotive industry.
