Many of the cars in these yards come from salvage auctions run by companies like Copart. A lot of the 'donate your car' charities sell through them, but the major source is insurance companies, who will total an older car for very minor damage. Many of them could be easily repaired, but (in my opinion) there is a hidden agenda at work here. If the insurance company totals the car, the owner has to go out and buy a new one. So the dealers make money on a sale, the finance company makes money on a loan, the state makes money on sales tax, and the insurance company makes money because they charge more to insure a newer car. Which is also what happened in the 'Cash for Clunkers' program.