After his near-accident, The Narrator is still in the car, driven by the mechanic, with the three other space monkeys sleeping in the back seat. The mechanic tells the Narrator that he’s just had a “near-life experience.”
The mechanic thinks of the Narrator’s brushes with danger as valuable because they force the Narrator to get over his inhibitions and embrace “real life,” even though they seem to compel the Narrator to give up on life altogether.
The mechanic goes on to tell Jack that he’s been running errands for Tyler, picking up fat. He speaks in phrases that the Narrator recognizes hearing from Tyler for the first time.
The mechanic is a pawn for Tyler’s wishes: he has no true personality of his own anymore, showing how Project Mayhem has gotten out of hand and undercut its own anarchist, individualistic ideals.
The mechanic drives to the medical waste dump, and there, in the medical waste incinerator, he finds bags of human fat. He’ll take the fat back to Tyler’s house and make it into bars of soap, sold for 20 dollars apiece. The mechanic mentions that he’s been asked to look for some “hepatitis bugs, too.”
Neither the Narrator nor any of the other space monkeys know what Tyler has planned; they’re just doing Tyler’s bidding. The mention of hepatitis alludes to the conversation Tyler and the Narrator had with the drunken doctor at the hotel—Tyler might be trying to cause a serious health problem.