As the materiality analysis shows, CNH Industrial recognizes the importance of reusing, recycling, and recovering components that could otherwise become landfill waste at their end of life.
Based on the outcomes of the stakeholder engagement activities conducted in 2014, (see also page 19), in EMEA and LATAM remanufacturing is considered a relevant aspect. Stakeholders believe it is important to reduce raw material usage and CO2 emissions, cut costs by reusing recoverable materials, thus avoiding waste, and extend remanufacturing to other sectors. In NAFTA, remanufacturing is an expanding industry throughout the USA. However, stakeholders feel that more stringent standards are necessary to streamline the technical specifications of processes and to ensure reliable and consistently high quality end products. By regenerating, or remanufacturing, worn components (cores), CNH Industrial reduces waste, reuses materials, and encourages the recycling of recoverable materials. Additionally, by avoiding the extraction of new raw materials, it reduces both energy use and the production of greenhouse gases. Indeed, the reconditioning and reuse of components lessens environmental impact by contributing to reducing the use of raw materials by about 1,200 tons per year, with a corresponding reduction in CO2 emissions.
Remanufacturing cores is an industrial process that allows granting the same standards of operational performance as new products, triggering a virtuous cycle of savings in raw materials and reductions in materials going to landfill.
This process ensures customers reliability and reduced vehicle downtime at competitive prices.
The Parts and Service function leads the overall remanufacturing project in close cooperation with FPT Industrial for all driveline related parts, and the function head is a member of the Group Executive Council. There are various stakeholders involved in the remanufacturing process:
- dealerships, which propose remanufacturing solutions, salvage cores, and fit remanufactured parts on vehicles
- suppliers, which remanufacture cores and grant the same operational performance as new products
- Parts and Service, which manages product portfolio, commercial offer and communication, training to dealers, and logistics and reverse logistics processes.
Parts and Service manages the overall process, from the collection of cores from dealerships to the stocking and retailing of remanufactured products to end customers. CNH Industrial offers a full range of original spare parts to cover the entire life cycle of all products, alongside a broad selection of remanufactured parts. All brands can thus offer more environmentally friendly products, like-new quality, and good value, since remanufactured parts save the customer an average 30% on the purchase price.
As stated in the Sustainability Plan, CNH Industrial’s objective is to ensure that, by 2016, 5-10% of spare parts sales will consist of remanufactured parts, with variable percentages according to Region.
Specifically in EMEA, Parts and Service collects cores from dealerships and transfers them to the FPT Garchizy plants (France), or to one of its certified and approved suppliers. Indeed, the supplier’s knowledge of components and their design guarantees the efficiency and quality of the remanufacturing processes, while all technological upgrades currently available on the market are also offered on the remanufactured product.
THE REMANUFACTURING PROCESS
Once delivered, cores are disassembled, cleaned, and inspected. After inspection, all unrecoverable parts are recycled or disposed of. Strict adherence to current laws is guaranteed throughout the process in terms of the proper disposal of products or parts thereof that are no longer usable and thus discarded.
Core recovery is key to achieving maximum efficiency in the remanufacturing process (the replacement rate), and is performed by professional experts who ensure final product quality.
Cores are remanufactured using parts that are either new or remanufactured themselves, as per the original design, technical specifications, and regulatory standards. Finally, the functional requirements of remanufactured components are certified following rigorous in-house benchmark testing, which gives customers the certainty of purchasing spare parts offering the same quality, performance standards, life expectancy, and emissions levels as the equivalent new components. As further proof of their high quality and reliability, the spare parts remanufactured by CNH Industrial are subject to exactly the same maintenance intervals and warranty conditions as new parts.
Products are remanufactured for Case IH, New Holland Agricultural and New Holland Construction Equipment, Case Construction Equipment and for Iveco products. They include a wide range of more than 2,000 parts, including: engines (blocks or components), transmissions, cylinder heads, turbines, starter motors, alternators, fuel injection systems, control units, flywheels, clutches, compressors, hydraulic components, and more, available across the board for all CNH Industrial brand products.
In 2014, the sales of remanufactured parts for the Commercial Vehicles segment increased by over 60% compared to 2013, demonstrating the potential for expansion, provided the offer is broad enough and marketed to customers seeking to contain costs.
REMANUFACTURED SPARE PARTS AVAILABLE