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Peeling
Peeling typically occurs on pavement that had previously been overlaid with asphalt and the overlay layer of asphalt has begun to fail as a result of underlying fatigue "reflecting" up through the overlay layer.
This usually occurs many years after the overlay has been installed. The overlay layer oxidizes, and becomes brittle and much more susceptible to the underlying fatigue cracking reflecting through. Once the fatigue failure has reflected through, the overlay now exhibits the same fatigue failure as the underlying asphalt.
The pieces from the overlay tend to break free, exposing the original, fatigued asphalt beneath it.
The only permanent repair for these areas is a complete removal and replacement of the entire failed area along with the underlying fatigued asphalt.