The Future of Converter Recycling: What Happens to Platinum Group Metals (PGMS) if Combustion Engines Become Obsolete by 2030

Will the world’s governments and automakers meet their climate-control-driven mandates to discontinue sales of diesel and gasoline cars in favor of zero emission vehicles by 2030? And what does the electrification movement mean for the supply and demand of precious metals predominantly used in automotive catalyst to control emissions?

The “Group of Seven (G7) nations backed away from plans to set a target for making sure most new cars sold are greener vehicles, instead pledging only to speed up efforts to move away from combustion engines,” reported Automotive News on June 14.  This language was a move away from earlier communication drafts that spoke of “ensuring” that most car sales would be zero emission by 2030.

In the short-term, for the next 10 – 15 years, expect to see an increase in the demand for platinum group metals or PGMs for several reasons. As emission standards increase across the globe so do the PGM loadings in converters. The real-world driving emissions (RDE) test which measures specific pollutants such as NOx emissions requires higher loadings of rhodium (Rh), the superior metal application.  Analysts and consultants suggest as much a 20% higher. Hybrids and plug-in hybrid electric vehicles (PHEVs) also require 5-10% more PGMs due to frequent engine cold starts. As the world makes the move toward electrification with hybrids leading to fully electric and then fuel cell-powered vehicles, auto catalyst producers are set to swap out the more predominant palladium (Pd) for platinum (Pt) and rhodium (Rh) in the coming years.

With more precious metals being used in converters and an average vehicle age of 20 at the time of scrappage, the supply of recycled PGMs especially Pd is expected to increase from 5 million ounces (MOZ) to 7 MOZ. by its peak in 2031-2032. As mobility trends toward fuel cell electric which uses more platinum in the storage of hydrogen energy, it is the long-term demand for palladium that is in question. If zero emission mandates are adopted to allow for only fully electric vehicles, plug-in hybrids (PHEVs) and hybrid electric vehicles (HEVs) will be eliminated along with ICE vehicles. Palladium demand will be seriously hampered. Consultant, Matt Watson, of Precious Metals Commodity Management, LLC, suggests that “Palladium will push from structural deficit to structural surplus without new demand source(s). It is not a question of if, it is a question of when.”

Outlook for automotive recyclers and auto catalyst recycling:
Over the next 15 to 20 years as vehicles come off the road, the supply of palladium from scrap catalytic converters is set to increase, while the supply of platinum decreases. At the same time, the opposite will happen to demand; platinum demand will increase as palladium demand decreases, unless alternative uses for palladium are found. In the short term, PGM prices are well supported at current, if not, higher levels.

In the short term, expect price volatility. Standard rules do not apply. Precious metals are considered a safe haven investment since they earn no interest, often a safety net when markets decline, or a hedge against inflation. With demand factors like semi-conductor chip shortages and increased use of PGMs in catalyst loadings, the technical rules may not apply. The moral of this story is, if you are recycling scrap catalytic converters on assay, and participating in the sale of your precious metals, stay hedged.

If you have questions about this article or any issue pertaining to the recovery of precious metals and materials from automotive recycling, we, at United Catalyst, are here to help you. United Catalyst Corporation is a processor of scrap catalytic converters that offers global refining services. Our recycling solutions are accurate, scientific, and verifiable to get you the most money. United Catalyst is a processor you can trust.

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Becky Berube serves the recycling community as President of United Catalyst Corporation, Co-Chair of the Automotive Recycling Association’s Events Advisory Committee, and is an ExCom Board Member of the International Precious Metals Institute. She can be reached at 864-834-2003 or by email at