K mart launches battery recyling

K mart Launches Battery Recyling

TROY, Mich. - Seizing on both environmental concerns and a steep rise in lead prices, K mart has joined with its main auto battery supplier, Exide, in offering $2 apiece for the estimated 40 million junk batteries lying around in basements and garages.

In full-page newspaper ads kicking off the recycling program last month and on instore fliers and posters, K mart said it is prepared to spend $80 million to help recover those junk batteries at $2 apiece.

Each of those junk batteries contains on average of $10 worth of lead at today's price of 50 cents a pound, plus about two pounds of reusable plastic casing. Some battery refiners, though not Exide, even salvage battery acid for reuse.

That content of poisonous lead makes junk batteries un-welcome at landfills, and many retailers refuse to accept junk batteries, even from customers who buy new ones.

Strikes at lead mines and smelter shutdowns have resulted in a world shortage of lead, said Joe Calio, vice president of sales and marketing for Exide. As well as aiding the environment, the K mart recycling program represents a way to "mine" lead from American garages and basements, he said, as prices have increased two-thirds from 30 cents a pound 18 months ago to 50.4 cents a pound June 1.

Some say lead may peak as high as 70 cents a pound on the London Metals Exchange.

Both K mart and Exide expect the recycling promotion will result in immediate sales increases of 1 percent to 2 percent in auto and light truck battery sales, Calio said, with substantial increases during the winter buying season.

Consumers usually buy batteries only when their old ones go dead, Calio said. The battery recycling program will create "a top of the mind awareness," Calio said, that should make consumers think of K mart for replacements.

In the first week, the 2,200 K marts around the country took in at least 80,000 junk batteries, including 1,500 from one source alone, Calio said. "We suspect the 1,500, equal to a truckload and a half, came from a dealer," he said.

Those who responded in the first week typically brought in three to five junk batteries, Calio said.

Ironically, the $2 offer doesn't apply to those who buy car batteries from K mart but does apply if they buy new batteries from competitors that won't accept junk batteries. The promotion is entirely separate from K mart's trade-in pricing policy of charging $5 more for batteries if they fail to leave an old one behind. If they don't, K mart charges a $5 deposit, refundable upon return of a junk battery.

K mart contends that customers already are getting $5 off the price of a new battery by leaving junkers behind.

Junk batteries are worth on average at least $2.50 so K mart could turn a modest profit on its recycling program. In the normal course of picking up trade-in junkers, Exide also picks up the extra junk batteries, shrink wrapped on pallets, that consumers are turning in.

Last year, K mart recycled at least 70 junk batteries for every 100 sold, for an 70 percent recycling rate. When K mart increased the core deposit to $5 from $3, the recycling rate increased to 97 percent for April 1990, Calio said.

K mart reportedly sold almost two million of the 51 million replacement car and truck batteries shipped in in 1988. Calio declined to disclose K mart battery sales for 1989.

Mass merchants that charge a core deposit on batteries, such as Fred Meyer, Rose's Stores, Sears, Montgomery Ward and Pep Boys, typically experience recycling rates of more than 75 percent.

At discounters that don't charge deposits, including Wal-Mart, Ames, Bradlees, Hills, Target, Venture and Sam's Wholesale Club, recycling rates range from an estimated low of 1 percent at Sam's to 13 percent at Wal-Mart.

Out of more than 1,400 Wal-Marts, about 350 offer automotive service, and old batteries automatically get recycled when customers let Wal-Mart mechanics install new batteries. But at "dry" Wal-Mart stores, those without auto service, automotives clerks typically tell prospective battery purchasers to take their junk batteries to, say, service stations, because Wal-Mart is unprepared to deal with them.

State laws requiring retailers to charge deposits to encourage recycling still gain momentum and a federal bill to require them remains pending.

Michigan is the latest to pass a battery recycling law that requires retailers to accept one junk battery for every one sold. Effective January 1993, Michigan retailers will have to charge a $6 deposit to encourage returns.

Other states that have passed battery deposit laws include: Maine, $10; Minnesota, Rhode Island and Washington, $5; and North Carolina, $3, effective next Jan. 1.

In addition to the deposit states, California requires retailers to accept junk batteries from customers who buy new ones. California law provides for a $1,000-a-day fine for violation, but so far air pollution takes enforcement priority over the battery recycling law.

PHOTO : At a K mart auto center, an Exide driver unloads junk batteries that will be recycled.

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