As more automakers shift towards hybrid vehicles before committing to going fully electric, fears surrounding catalytic converter production have eased, reports The Street.
Indeed, EV sales are in a slump right now, with more consumers opting for hybrids and plug-in hybrids. This has led to automakers diverting initial, more ambitious plans.
Volvo, for instance, is now reconsidering going fully electric by 2030 due to a lagging charging infrastructure, a decrease in government incentives, and tariffs being imposed on EVs. They were followed by Ford, who scrapped plans for an electric three-row SUV in favor of hybrid SUVs.
Catalytic converters, in recent years, have become a household name synonymous with theft. Thieves steal them from vehicles for the valuable metals they’re made up of, such as palladium, platinum, and rhodium.
While an increase in EVs would eliminate the need for catalytic converters, as the tides shift toward hybrid vehicles, there may be an even bigger demand for them than before.
Hybrids often require bigger catalytic converters than a typical internal combustion engine, which has meant good news for commodities traders and mining companies such as Anglo Platinum, Impala Platinum, and Sibanye Stillwater.
The revival of demand for these metals will likely mean mines remaining open for longer, as well as a floor being enforced on prices for these metals, and consequently the parts that come from them.
Wilma Swarts, director of PGMs (platinum group metals) at consultancy firm Metals Focus, shared that the hesitancy toward EV adoption may point to hybrids playing a major role in the automotive field into the 2030s—which is good news for her industry.
“The shift to hybridization could be quite meaningful for the longer-term sustainability of the PGM industry,” added Swarts.
