Co-hosted by China Automotive Technology and Research Center Co., Ltd., Society of Automotive Engineers of China, China Association of Automobile Manufacturers, and China Automotive News Agency, with special support from the Management Committee of Tianjin Economic-Technological Development Area, and jointly organized by Japan Automobile Manufacturers Association, German Association of the Automotive Industry, China Innovation Alliance for Automotive Power Battery Industry, National Big Data Alliance for New Energy Vehicles, China Artificial Intelligence Industry Development Alliance, and European Automobile Manufacturers Association, the 21st China Automotive Development (Taida) International Forum (hereinafter referred to as "Taida Automotive Forum") will be held in Binhai New Area, Tianjin from September 11 to 14, 2025. This year's Taida Automotive Forum will revolve around the annual theme of "Boosting Momentum, Opening New Chapters, Towards the World", inviting heavyweight guests for in-depth discussions.

In the "Carbon Cycle Ecology Session: Disassembly and Reconstruction, Ecological Changes in the Automotive Aftermarket" on September 12, Zeng Wan Gui, founder and chairman of Baturu Information Technology Co., Ltd. in Guangzhou, delivered a speech titled "Digital Platforms Empowering Automotive Disassembly and Aftermarket Parts Circulation".

 Zeng Wan Gui, Founder and Chairman of Baturu Information Technology Co., Ltd. in Guangzhou

The following is the speech transcript:

Hello everyone, many expert speakers before me have talked about the background of scrapped vehicle recycling and disassembly circular economy. China's vehicle population has now exceeded 350 million, the age of fuel vehicles is continuously increasing, the penetration rate of new energy vehicles has reached nearly 50%, and as of today, our average vehicle age is about over 7 years. These two sets of data indicate that vehicle scrappage will accelerate, entering a period of rapid growth.

However, in terms of value utilization of scrapped vehicles, in the past, vehicle scrappage was more focused on material usage, with very little value realization in the dimension of parts reuse. Moreover, in recent years, due to major trend and environmental changes, various industries, associations, including CATARC, have promoted the introduction of many policies and regulations favorable to industry development, which is the premise for the sustainable development of reused parts and remanufactured parts. Therefore, from this dimension, based on our industry experience, growth in the dimension of reused parts and remanufactured parts will be very fast next. Currently, from our industry experience, the annual volume and amount of reused parts in China, that is, the circulation amount, is close to a scale of 100 billion. Here is a well-known American case: LKQ, which is a case in a mature market for reused parts and remanufactured parts. This company was established when the average vehicle age in the US reached about 8 years. The company's development has been relatively healthy, both in terms of scale and profitability. LKQ has two development approaches. The first part is scale growth development, relying on the following dimensions: one is continuously building distribution networks; two is improving fulfillment and delivery efficiency through warehousing built in various places, and system construction; three is starting from reused parts and recycled parts, gradually transitioning to new parts, providing customers with one-stop services. In fact, now the proportion of new parts exceeds 60%. The second part is the entire sales system, channels, fulfillment and delivery capabilities, and integration with new parts to provide one-stop services, which can promote the company's long-term healthy and sustainable development.

I believe that from these two development approaches, China's current industry infrastructure, whether collaborative channels or fulfillment and delivery systems, are already very mature. Whether from the trend of vehicle scrappage or the infrastructure of parts circulation, it verifies that reused parts and recycled parts have great development potential in China. Although currently still in the early stage of development, our company and I personally pay high attention to the aftermarket parts supply chain dimension. From the parts perspective, there are indeed many pain points in scrapped vehicle disassembly, especially in the past two or three years, it has been very difficult for disassembly companies to profit, with a lot of resources wasted. The experts before me have talked about many, from the upstream of the industrial chain, circulation intermediaries, parts dealers, to maintenance companies on the demand side. There are very obvious misalignments in the division of labor among various industrial entities. For example, disassembly plants from vehicle acquisition, disassembly, sales to irregular disassembly and sales intervened by circulation merchants, etc., intertwined with each other. These irregularities cause great losses to the industry's development prospects, efficiency, and professionalism. From the current industry status, for new parts circulation, we believe there are very mature solutions. The key is to ensure that each entity in this industrial chain returns to its proper position and does its own job well, so as to achieve value return (from vehicle recycling, disassembly to parts circulation), and then fully release the value in this chain, allowing all parties to achieve due benefits.

Because I have been doing new parts circulation before, in the past more than ten years, our business has not involved reused parts and remanufactured parts mainly because they were not compliant, so we want to do it very standardly, but the industry foundation is not very good.

In terms of parts circulation to the market, parts dealers back to parts demand, to do this well, I think the experience of new parts can be borrowed: parts professionals should focus on parts circulation, but the main users of parts are various types of repair shops, whether 4S stores, maintenance shops, or quick repair chain stores, they are the buyers and consumers of the vast majority of parts. These people have a characteristic: their understanding of parts is more from the vehicle model and parts name. For example, a suspension part of a certain car, its description and procurement use language logic to understand the parts. But the upstream sellers and circulators understand parts not by textual names, but by digital logic, because there are too many parts SKUs. To achieve precise delivery, parts are managed by numbers and codes, so the source of industry chaos is the inconsistency in language between buyers and sellers, leading to chaos caused by information asymmetry.

So Baturu has been committed to the research of industry parts data since 2009, breaking through the communication language between buyers and sellers. Only under such conditions can the transaction circulation efficiency be improved when parts go from the source to downstream. Therefore, through more than ten years of accumulation in the advanced field, in terms of data system tools, supply resources, and operational capabilities, these capabilities can support the digitalization of the entire process from scrapped vehicle acquisition to sales. The upper half of this diagram, the gray part, is the operation method in the traditional chain: from vehicle recycling, disassembly, parts warehousing, sales, delivery. These transaction data and operation scenarios are more defined by comparing vehicle weight and materials to define a vehicle's value. Because different trades are like different mountains, scrapped vehicle plants lack professionalism in understanding parts: which parts are useful or not, how to disassemble, everyone is still at a very rough stage.

From the disassembly perspective, using the new parts view, we can disassemble a vehicle's parts down to the level of every screw and nut. In traditional disassembly, there may be many cases, such as disassembling a front assembly, door assembly, etc. These so-called assemblies are still relatively vague, and there are many problem points in the disassembly process. We can associate the structure of a vehicle with its various assemblies or sub-assemblies, each part precisely one-to-one corresponding from parts. That is to say, before a vehicle arrives at the disassembly plant for disassembly, through data analysis, it can intelligently and automatically output how to disassemble, and each disassembly, whether assembly or sub-assembly, can be associated with every part model. Then, the disassembled parts, during circulation and docking with customers, matched with the corresponding pictures, whether its condition or included content and details, are very clear. This circulation efficiency is very high.

From the sales perspective, as I mentioned earlier, acquisition, disassembly, sales, we have now integrated used parts into the new parts collaboration platform. After disassembling reused parts according to this standard, inputting the VIN on our platform can precisely find what the customer wants. As long as the customer knows the part name, they can precisely buy the part they want, whether assembly or sub-assembly. For example, for a car door, inputting the lift motor can also bring out this assembly. Or inputting door assembly can bring out all parts included in this door, even sealing strips, glass, etc., all parts can be brought out, making its circulation very high.

For the entire scrapped disassembly, here is a case. As we said, starting from 2022, after policy support, we gradually entered this field. This is what we have done in the past two years for many disassembly plants and second-hand parts circulation merchants, digitalization cases. For example, disassembly plant like Jiande No.5 Plant in Hangzhou does disassembly well. After completing standardization in March this year, without changes in resources, sales increased more than 3 times, with significant results. From the effect of scrapped vehicle recycling, disassembly, and value mining, the effect is very good. I just told everyone, whether it's scrapped vehicle disassembly enterprises or second-hand parts operation enterprises, through the application of our new parts solutions, the efficiency and effect have qualitatively changed and improved.

Finally, I also want to say that we hope to have more opportunities next, to use the capabilities accumulated over these years, as the last link in the full lifecycle of scrapped vehicles, together with fellow colleagues, to make the aftermarket second-hand parts and reused parts more efficient and professional, and also help disassembly enterprises and second-hand parts operation enterprises improve profitability.

Thank you!