Making it rain or flooding the market? Bill on water-damaged cars sparks debate.

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Making it rain or flooding the market? Bill on water-damaged cars sparks debate.

Cars damaged by a flood in Paju, Gyeonggi [NEWS1]

Cars damaged by a flood in Paju, Gyeonggi [NEWS1]

 
A motion to allow the export of totaled vehicles that are flood-damaged has sparked a heated debate as to whether will reap dividends by recycling car parts — or cycle the cars back into the Korean market.
 
Under the current law, vehicles totaled due to water damage cannot be exported to foreign markets — even in parts — per an amendment to the Motor Vehicle Management Act in June 2023. The revised act was designed to prevent totaled cars from being imported back into the Korean market after being exported only on paper.
 

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Such cars, classified as vehicles deemed unable to be repaired due to water damage to either the engine, electronics, interior or other key components, must be scrapped within 30 days of being declared totaled under the current law.
 
However, a new amendment proposed by Democratic Party Rep. Eom Tae-young on Jan. 7 aims to enable the export of totaled vehicles that are damaged by water for recycling purposes.
 
“By allowing the export of water-damaged vehicles, we are reconsidering the usage of resources and preventing side effects caused by the export ban,” the amendment proposal, uploaded to the National Assembly’s website, said.
 
The bill claims that scrapping totaled vehicles that are damaged by water within the country is time-consuming and can harm the environment.
 
“There also are economic losses considering other major nations allow the export of water-damaged vehicles,” the proposal said.
 
The auto parts recycling industry has been calling for an amendment to the Motor Vehicle Management Act as some parts from water-damaged vehicles can be saved and sold.
 
“In the case of totaled vehicles that are damaged by water that are less than a year old, the salvage value of some exterior and interior parts that are not related to the electronics can be pretty high,” a source in the recycling industry said.
 
The industry claims that the sale of parts from the roughly 7,000 vehicles totaled by water damage each year to overseas markets, including Southeast Asia, can bring in up to “tens of billions of won.”
 
But the fear lies in such totaled vehicles being reregistered in the Korean market with fake export documents.
 
“Vehicles totaled by water damage are prone to ignition failure, fire hazards and the malfunction of automatic emergency braking systems,” Lee Ho-geun, an automotive professor at Daeduk University, said.
 
“Such vehicles being illegally sold in the used car market can reduce consumer trust.”

BY KIM HYO-SEONG [[email protected]]
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