Stellantis to launch platform in Michigan for dealers to get 70% cheaper service parts

Troy — Starting in December, several Michigan dealers selling Chrysler, Dodge, Jeep and Ram vehicles will have greater access to parts up to 70% cheaper through a service Stellantis NV is launching in North America, an executive for the automaker said Tuesday.

B-Parts is a part of Stellantis' circular economy division that focuses on reusing, remanufacturing, repairing and recycling parts to reduce costs, waste and carbon emissions. B-Parts connects salvage yards selling used vehicle parts with Stellantis' network of dealerships. The service already operates in Europe and is coming to North America, starting with 10-15 dealerships in Michigan.

In Europe, B-Parts has more than 5 million parts in stock sold in more than 160 countries. It offers parts available for reuse at up to 70% savings over new parts and remanufactured parts up to 30% less, Alison Jones, Stellantis' senior vice president of the circular economy business unit, said during a sustainability summit hosted by MEMA, the vehicle suppliers' association. Repaired parts also are available for less, but a percentage hasn't been shared, because it depends on how much labor is needed to make a repair.

Many salvage yards already sell these parts, but B-Parts offers an e-commerce platform that makes access easier, Jones said. The service is expected to launch in the rest of Michigan as well as in Texas and New York in 2024 and annually add seven to 10 states each year.

"The strength we've got and what we saw in Europe, we have a big dealer network, and we have a big presence in people knowing who Stellantis is," Jones said. "B-Parts has a very efficient software system and payments process."

There can be challenges with the individual quality of parts ordered this way, Jones said. The company, though, has instituted measures to ensure, for example, that stolen parts aren't being sold.

"For those dealers who have really embraced (B-Parts)," Jones said, "you can see are driving an affordability solution for customers to enable them to extend the life of their vehicles."

Meanwhile, remanufactured parts often have to be engineered again, and the automaker validates and checks the quality of that work. This process, though, can take months to get the program running. A "SUSTAINera" branding may appear on packaging of parts where up to 80% of raw material has been saved, and the company is considering using the label on parts in new vehicles, as well.

Globally, the circular economy covers about 15% of Stellantis' parts catalog. The goal is to increase that to 40% by 2030. Repair and remanufactured sales represented $587 million (528 million euro) in revenue in 2021, and the division is financially viable, Jones said. In the first half of 2023, that revenue is up 25% year-over-year. The goal is $2.2 billion (2 billion euro) by 2030.

Some of those efforts will be done in-house. For example, Stellantis for years has been doing return-to-standard activities that involve working on used vehicles in Metro Detroit to prepare them for resale.

This fall, it's launching its first circular economy hub in Mirafiori, Italy, taking workers off the production line to remanufacture engines and transmissions, recondition vehicles to sell as used vehicles and dismantle vehicles. There will be 550 workers doing that by 2025. The company also is assessing where it will retrofit internal combustion engine vehicles to become EVs.

A timeline for when North America could get a circular economy hub hasn't been set.

Jones noted the redeployment of workers to the new work could help with employee retention based on the results of suppliers who work in remanufacturing. Compared to workers on an assembly line who may do their job in a couple of minutes repetitively, it takes longer to rebuild an engine, and sorting materials is more varied work.

The automaker also is looking for suppliers with innovative ideas on how to implement the four Rs of its circular economy to expand the number of products incorporated. Jones said there are a lot of opportunities in newer parts, such as in infotainment, but there are needs from air-conditioning compressors to rear axles as the next tranche her division is looking to add to its catalog.

Also on the horizon is a partner on recycling batteries. The company has a network of partners to conserve batteries, but Jones said she is working on a collaborator that will work with the automaker to recycle EV batteries.

Mandates from European regulators will increase the amount of recycled content required to be a part of EV batteries in coming years. This is a good sentiment, Jones said, but with efforts to increase the life of a battery, she expressed concern there won't be enough recycled material available to meet increasing requirements. Meanwhile, the United States' legislation known as the Inflation Reduction Act allows battery material that may have originated outside the country to be considered local content if it was recycled in the States.

"The legislation is almost going ahead of the age of the batteries to have enough batteries to go back in," Jones said. "All of them are trying to increase recycled material content. And that's OK. We're trying to increase recycled material content, but the implementation can be a challenge."

bnoble@detroitnews.com

Twitter: @BreanaCNoble