When a car reaches the end of its life, in most cases, it finds itself drained of fluids and stripped of valuable components. Then it’s crushed and shredded so that its various metals can be sorted and melted down at a foundry.
Recycling that material is certainly better both economically and environmentally than mining new materials from the ground. But that car also represented a huge energy cost to manufacture in the first place, and another when it was recycled, and again when those recycled materials are eventually made into something else.
While it’s not ideal, for cars it may prove difficult to move away from such a model – certainly anytime soon. But when it comes to heavy equipment there is another model which makes much more sense – remanufacturing.
In contrast to refurbishment, remanufacturing a product brings it right back to ‘as new’ specification and performance. It’s something that Caterpillar has been doing for around twenty years, and it now actually designs its new equipment with not just one life in mind, but two or even three, and also with the remanufacturing processes that will make that possible in mind. And it doesn’t just rebuild whole machines to as new spec, it also offers 7200 individual part numbers through its dealer network on a trade-in basis.
“From a remanufacturing point of view, it’s bringing back that old iron, the old core,” Ian Vickers, market development specialist for remanufacturing at Cat tells WMW. “When we say core we mean the old used engine or component and bringing that component back to life using different salvage technologies.”
How it works
The way Cat’s Reman program works is that customers go to their dealer needing a component and they’ll be offered different options, depending on the component, remanufacturing will be one.
“From a Reman point of view there will be an offer of a part, let’s say an engine,” Vickers explains. “The customer will walk in and ask for an engine for their machine and they’ll be given possibly two or three different options – a brand new engine, a remanufactured engine or possibly a dealer rebuilt engine. All of these will be at different price points.”
“When we refer to a Caterpillar remanufactured component we’re referring to a ‘same as new’ standard,” he adds. “What the customer will purchase is same as new quality and performance, with a new warranty – at a lower cost point.”
According to the company, its remanufactured engine components are typically priced at 40-70% of new. The customer also receives credit for their used core through the Core Acceptance Program.
“The whole program works on the basis that the customer will return the old used engine to the dealer, who will evaluate the condition of that core,” says Vickers. “The money returned back to the customer will depend on the condition of that core. It’s a very easy inspection. Is the engine running, does it rotate, and so on. At that point the transaction between the dealer and the customer will finish and it’s returned back to ourselves at Caterpillar to remanufacture.”
“Let’s say it’s a seized engine,” he continues. “We will still pay for that engine, but it will be what we call a partial credit. Our strategy is that if a customer replaces any component before catastrophic failure, the majority of the time they will receive the full core deposit. It does depend on the product but it can range from 30% to 80% of new.”
Metal on Metal
Once the component is returned to Caterpillar it will be completely striped down to its original castings so that all the items that ware within the component can be replace and recycled. It is then rebuilt using salvage techniques such as adding metal to metal. That product will then be tested to the same standards as new, and will reenter the supply chain.
“When it comes to adding metal to metal it’s a really complex process and it depends on the type of product,” says Vickers. “For example, to add metal to a cylinder head we use one technique but to add metal to the bore of a block would be a different type of salvage technique because bond strengths have to be different. We have 20 different ways of adding metal to metal using different materials and different techniques.”
One such technique is twin wire metal spray. Vickers explains this process as using two wires made from different types of material that come together to make an arc. Behind that arc is high pressure air. The molten particles are then blasted onto the parent metal. This builds up layers on top of the component, which can then be machined back to its original design tolerances.
This technique can be used to rebuild worn cylinder heads. However, if the head is cracked puddle wielding is a typical solution. Here the crack is machined out and molten metal poured in. Once set the filler metal can be machined back down to standard specification.
A similar technique to the twin wire process uses plasma gases, which allows for micro particles to be thrown at a higher speed onto the parent metal, allowing for more control and a stronger bond.
“We’ve been using some of these techniques for 20 years and we’ve been very successful,” he adds. “It’s something we’ve developed as time moves on. As technology moves forward, and it becomes cost effective, we introduce new salvage techniques,” he says. “The minimum standard we have to be, is as good as new. So if we add metal to metal the bond strength between the two materials must be as strong as the new equivalent.”
Made for Rebuilding
It’s not just components that Cat takes back and reworks. It’s whole machines. And that’s where the company’s Rebuild program comes into play. Offered through the dealer network the program offers five options.
“We rebuild the whole machine,” Mathias Donguy, marketing specialist at Cat’s Engine Power Train division tells WMW. “We rebuild the certified powertrain, we rebuild the certified hydraulic system, we offer a certified component rebuild and we offer a certified engine rebuild. Our machines are built to be rebuilt.”
“It’s a process which is run by our dealers,” he continues. “They will inspect the machine, disassemble the machine, recondition or change the parts that need to be changed. Caterpillar has a list of parts that must be changed, and a list of parts which must be inspected. Then we incorporate any new engineering updates… If the engineering updates improve the performance it will be a better machine that when it was made 10 years ago.”
While the two programs are separate, with remanufacturing taking place in Caterpillar factories, where possible the Rebuild program, which is carried out by Cat dealers, uses Cat Reman components where possible.
Donguy explains that once a machine has been through this process it will come with a new warranty and a new serial number. Typically he says that a machine can be rebuilt twice before the volume of parts needing replacement makes it uneconomic. Some small machines may also be economically unsuited to the process, because of the cost of labour versus the cost of buying a new machine. However, those machines that do go through the process are typically sold to new customers for 50%-70% of what they would have cost to buy brand new.
Lessons for Others
According to Vickers, one of the keys to making the system work is knowing where the products you’ve sold are. To that extent Cat has developed its own tracking system.
“From a remanufacturing point of view we have the complete analytics of the logistics flow from the point of sale of the component, making sure that we track that component to come back to us to have a complete cycle all the way around,” he says. “Through our distribution centres and our dealer networks we know how many pieces of a part number have sold and how many cores can come back. As many Reman parts as we sell we try to recover that many cores.”
The advantages of taking used components back and remanufacturing them are not only to the customer. According to Cat, remanufacturing a cylinder head instead of manufacturing a new one produces 61% less greenhouse gas emission, 85% less material, 86% less water and 85% less energy.
In 2014 the company recovered some 2 million cores weighing in at 75,400 tonnes. That’s a lot of energy, water and GHG emissions saved. While Cat may have the luxury of working with heavy iron, which can, with care, be brought back from a beating, there are certainly lessons other industries could learn when it comes to making and tracking products that live more than one once.
Maybe one day Cats really will have nine lives, but for now two or three has to be better than one.