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Market Overview

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The global market for precious metals in automotive applications was valued at $40.85 billion in 2021 and is projected to reach $79.82 billion by 2031, exhibiting a compound annual growth rate (CAGR) of 7.0% during the period from 2022 to 2031.

The demand for precious metals in automotive applications is expected to increase due to the growing need for catalytic converters in the automotive industry. Additionally, the investment in platinum group metals in African countries is likely to create opportunities for the market in the coming years. Moreover, the use of platinum in electric vehicles is another factor driving the demand for precious metals in the automotive applications market from 2022 to 2031. However, the high costs associated with platinum group metals may hinder market growth in the future.

Precious metals are rare, naturally occurring metallic elements that hold significant economic value. They exhibit lower volatility compared to many other metals and are characterized by their malleability and high luster. Precious metals have long been incorporated in the automotive industry to ensure the reliability and sustainability of components such as catalytic converters and engine sensors. As automobiles become more technologically advanced, precious metals are becoming increasingly valuable. They play a crucial role in the rapidly expanding automotive sector, enabling the development of innovative products such as electric vehicles and hydrogen fuel-cell vehicles. The growing utilization of precious metals in automotive catalytic converters, the focus on electric vehicle manufacturing, and technological advancements related to precious metals in automotive applications are driving the growth of the market. The market is also benefiting from stringent government regulations on vehicular emissions, as precious metals are widely used to reduce emissions. The increasing focus on carbon emissions reduction in automobiles is expected to drive the demand for precious metals in automotive applications.

The market for precious metals in automotive applications is still in its growth phase. Investments in research and development activities and increased demand from end-use industries, along with rising public concern, are expected to drive the demand for electric vehicles, thereby boosting the market for precious metals. The utilization of precious metals in components like catalytic converters and engine sensors contributes to environmental sustainability, further driving the demand for precious metals. As automobiles become more advanced, the value of precious metals is anticipated to increase.

With a global focus on achieving net-zero carbon emissions, the transition to sustainable technologies presents significant sales and financing opportunities. This shift is particularly evident in regions such as North America, Europe, South Africa, and certain Asian countries.
Furthermore, the impact of precious metals on automotive applications is moderate to high and is expected to increase in the future with the growth in automotive production.

The COVID-19 pandemic had a significant impact on precious metals production due to country-wide manufacturing site shutdowns, labor shortages, and disruptions in supply and demand chains worldwide, leading to market distortions. Government-imposed lockdowns resulted in reduced productivity of raw materials due to limited operations across various regions. The automotive sector has experienced a slowdown in recent years, with plant closures leading to a shortage of automotive parts. However, the market is expected to recover gradually over the forecast period.

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Market Segmentation

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The market is segmented based on various factors, including end user, metal type, component, and region.

Segmentation by End User
Light Commercial Vehicles
Heavy Commercial Vehicles
Passenger Cars
Electric Vehicles

Segmentation by Metal Type
Palladium
Platinum
Rhodium
Gold
Silver
Others

Segmentation by Component
Catalytic Converters
Engine Control Units
Circuit Boards
Sensors
Switches
Windshield Defogger
Others

Segmentation by Region
North America – U.S., Canada, and Mexico
Europe – Germany, France, Italy, Spain, and Rest-of-Europe
China
U.K.
Asia-Pacific and Japan – Japan, India, South Korea, and Rest-of-Asia-Pacific
Rest-of-the-World

During the forecast period 2022-2031, the passenger car segment is expected to be the largest among different end users. This can be attributed to the growing use of precious metals in manufacturing passenger car components, especially catalytic converters, due to the increased need for these metals. The passenger car segment is experiencing rapid growth, and the automotive industry fully utilizes the advantages of precious metals, such as their high melting points and ease of recycling. Automakers have a primary goal of creating clean, safe, and energy-efficient cars, and in 2021, passenger car production reached an estimated 56.3 million units, the highest among all segments. Precious metals are extensively used in the automotive industry, including in catalytic converters, engine control units, sensors, circuit boards, and other interior and exterior parts of passenger cars. More than half of the world’s mined platinum is used in the automotive sector, which highlights the significant consumption of precious metals in this industry. The price of precious metals is influenced by their growing consumption, and upcoming technical advancements are expected to contribute to the revival of the automobile manufacturing sector.

Among different metal types, palladium is anticipated to lead the market during the forecast period 2022-2031 due to its wide utilization in automobiles and high durability. Palladium exhibits greater efficiency at higher operating temperatures, making it favorable for converting unburnt hydrocarbons in automobile exhaust fumes into less harmful substances. It is primarily used in petrol and hybrid vehicles for this purpose.

Catalytic converters are anticipated to be the leading component in the automotive industry during the forecast period 2022-2031. These converters utilize a catalyst, with platinum being a common choice due to its oxidation properties, especially in diesel and petroleum-powered vehicles. Palladium and rhodium are also commonly used in converters. Catalytic converters, positioned in the exhaust system near the engine, significantly reduce environmental pollutants such as carbon monoxide, unburned hydrocarbons, and soluble organic materials. They are modular, long-lasting, reliable, and cost-effective components. These converters consist of a ceramic structure shaped like a honeycomb and coated with precious metals (platinum, palladium, and rhodium) to initiate a chemical reaction that transforms hazardous pollutants into non-hazardous ones. Platinum is predominantly used in diesel and petroleum-powered vehicles due to its oxidation properties, while palladium is increasingly being implemented to reduce toxic emissions from petroleum-powered vehicles. The automotive sector consumes a substantial amount of palladium, and the increasing pollution regulations for combustion engine vehicles globally contribute to its demand. China, with its significant presence of precious metals manufacturers for automotive applications such as Heraeus Holding and Sino-Platinum, is expected to lead the precious metals market in this industry throughout the forecast period. The country’s focus on introducing unique and innovative cars, along with increased sales in the Chinese vehicle market, supports the demand for platinum group metals, particularly palladium. Additionally, the construction of new production facilities in China will further boost the demand for precious metals in the automotive industry, as these metals are crucial for reducing car emissions.

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Competitive Landscape

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The selection of the profiled companies has been based on inputs obtained from primary experts, extensive analysis of company coverage, evaluation of product portfolios, and assessment of market penetration.

The leading players in the segment are anticipated to dominate the precious metals market for automotive applications. In the long term, these players are projected to predominantly utilize silver metals, which currently hold an 81% market share by volume as of 2021. Other metals such as platinum comprise approximately 3.4% of the market, while palladium and rhodium account for around 13%. Gold represents roughly 2% of the market, with other precious metals constituting less than 1% of the total demand in 2021 in terms of volume.

Key companies profiled in this report include Heraeus Holding, Anglo American Platinum Limited, Impala Platinum Holdings Limited, Sibnaye-Stillwater, Northam Platinum Limited, Norilsk Nickel, Umicore, TANAKA HOLDINGS Co., Ltd., Johnson Matthey, Sigmund Cohn Corp., FIRST MAJESTIC, SINO-PLATINUM METALS CO. LTD., Hecla Mining Company, Fresnillo plc, Newmont Corporation, Royal Bafokeng Platinum, Generation Mining Limited, Desktop Metal, Inc., Nexa, Freeport-McMoRan.

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Recent Industry Developments

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In September 2018, Heraeus Precious Metals inaugurated a state-of-the-art precious metals facility in Nanjing, China. This facility is recognized as the world’s most comprehensive and advanced facility in the industry. The primary objective of this new plant is to significantly enhance Heraeus’ capabilities in refining and recycling precious metals and chemical products, with a particular focus on platinum group metals (PGMs).

In 2019, Tanaka Holdings Co. Ltd. made an announcement regarding the establishment of a new subsidiary named Tanaka Kikinzoku (India), located in Mumbai. The purpose behind this new division is to strengthen the distribution networks of precious metal products in India, the Middle East, and Africa. By the year 2024, Tanaka Holdings aims to achieve an annual sales target of approximately $26 million through this subsidiary.

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Key Questions Answered

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What are the primary factors and trends influencing the global precious metals market for automotive applications?

How has the COVID-19 pandemic affected the precious metals market for automotive applications worldwide?

What measures have existing players taken to enhance their market position, and what strategies have new players adopted as they enter this market?

Which metals type, component, and end user dominate the market, and what is their projected performance in the coming years?

What are the recent global developments in the precious metals market for automotive applications, and what patterns can be observed in terms of consumption?