Victoria Mindova
While Athens was taking its next dose of protests and tear gas, GRReporter has been able to reflect the positive example of the creative force of Greek society. We visited one of the many companies in Greece for scrap iron processing and recycling operating on the base of the magic principle "your garbage is my gold." The representative of ARCHIMEDES NEONAKIS S.A. Spiros Glantzis talked in detail about the role of such companies in support of the automotive market in Greece.
Automotive industry collapsed in 2010 as result of the crisis, high taxes, and especially the cancellation of the right to buy new car at a lower price if the old car is delivered for recycling. Once car dealers and importers have seriously clamoured for the poor market conditions, the government of George Papandreou decided to introduce again the old cars recycling subsidy as an incentive to new vehicles purchases.
Would you explain to us the principle of old cars withdrawal and recycling in Greece and how does it benefit both citizens and the state, car dealers and metal trading companies?
Every citizen who wants to buy a new car and has an old car goes first to the agency for alternative use of cars that permits the old car to be destroyed. Then people can go to any dealer selling new cars and purchase the desired vehicle.
Buyers benefit from the price reduction offered in turn of the old car recycling. The discount for the new car depends on the size of its engine. We are talking about a discount ranging from 350 to 2000 euros.
Let’s make it clear - the price reduction for the end buyer is the result of the state subsidy granted to car dealers, right?
The discount is the result of the state subsidy and some reductions offered by the producers themselves. The combination of the two can result in significantly greater reductions in the end price of new cars. According to the information we have from car dealers, the end customer’s benefit is in the range of 1500 to 6000 euros, depending on the current programs of automotive companies.
And what is the role of companies like yours in this process?
We take care to withdraw old cars and other unnecessary metal wastes from inhabited areas. We process them and sell them on the market as primary raw material for the steel industry. This is the whole point of recycling.
If a citizen wants to have the old car recycled, but the car is not in motion, what should the man do to get rid of it?
The citizen should call us and we can take the car from any part of the service area to our recycling center. Whether in motion or not, the car must be approved for recycling, which by law means that it must have all the important parts of a car. For example, we can not take and recycle a car with missing engine. Then, the car goes to the disassembly shop. It goes through a magnetic machine that separates the metal parts of the plastic and everything is sorted and recycled by type.
The present government of PASOK stated when came to power that the state could not afford to subsidize the automotive market and cancelled the discount measure applicable for the old car recycling. This has affected car sales seriously. So, what was the impact on companies like yours operating in the scrap iron trade?
The repeal of the programme for old cars withdrawal combined with the deepening economic crisis and the general poor market conditions certainly have affected car trade the hardest but the companies associated with it too. Workshops, spare parts trade, representations and employees in these sectors were affected. The automobile market in Greece registered decline of 65% in January, 2011.
How all this did affect you specifically?
Our industry was affected because the car is a source of very important raw material. Of course, metal trading companies have other sources to obtain the material. So, we somehow covered our needs in other ways. The reduction in the quantity of the raw material from car recycling is mainly due to the fact that even people who have old and even unnecessary cars did not give them for processing because there was the belief that the measure for car market recycling and subsidizing would be recovered. And it happened.
What is the percentage of old cars recycling in your company’s turnover?
About 20% of the materials we sale come from old cars recycling.
It is neither less, nor more, right?
It doesn’t matter whether it is more or less provided that any lack could prove significant in the situation today. Any resources are valuable and important for us.
Who is interested in recycled metal or in other words, what are your customers?
Our main customers are steel industry, producers of metal itmes and other plants. We are mainly export oriented and sale to countries like India, China, The Netherlands, Italy and other countries. We work not only with producers but also with dealers that forward the materials to other parts of the world. We have customers in Greece, but the foreign market offers better prices, greater demand and, in general our strategy is export oriented.
Don’t resale and transportation costs increase the end price of the output, whatever it is?
Everything is directly related to the volume of demand at a specific time. Of course, there is certain increase in costs, but the price depends on the material the customer wants, the quantity and the quality.
It is important to understand that the role of recycling has increased significantly in recent years. Nothing is thrown as garbage and everything can be processed and turned into new raw material. There are new technologies that give new life to old or unwanted materials.
Could you tell us more about the company ARCHIMEDES NEONAKIS S.A. and is there competition in your market?
The company has existed for almost forty years and its main activity in the beginning was to collect scrap iron. Today we are dealing with recycling and trading of metals. We have a foundry to produce aluminum which we sell too and we also produce scrap for export.
There have been certain growth in recycling in the last three or four years and this is mainly due to the fact that the Greeks had no culture of raw materials processing before. I can definitely say that our sector has started to grow significantly after 2006 and my forecasts are that companies like ours will enjoy positive growth in the next two or three years too.
There is competition and I can safely say that there are many good companies in Greece that are valuable competitors in our sector and provide quality raw materials. Each company tries to expand its activities and this raises the quality of the offered products and services.
The crisis has affected everyone in Greece. How has it affect your company?
The crisis has really affected everyone, there is not a Greek company that is not affected by this situation. It created employment issues, reduced production, although if we have to be honest, there is no significant production in Greece. There were difficulties abroad too but the situation is getting better.
We also have tightened the belts in our company and reduced costs where possible. However, we are adamant that we will not reduce jobs or salaries. ARCHIMEDES NEONAKIS S.A. currently employs about 110 people who are extremely important to us, so there will be no redundancies. There are other ways to optimize the operation of a company and we will take advantage of them when necessary.
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