Make Kitco Your Homepage

Metals Focus: European auto incentives to have limited impact on PGM demand

Kitco News

Editor's Note: With so much market volatility, stay on top of daily news! Get caught up in minutes with our speedy summary of today's must-read news and expert opinions. Sign up here!

(Kitco News) - European incentives to support the auto industry may have a limited impact on demand for platinum group metals due to an emphasis on electric vehicles and hybrid power trains, said Metals Focus. One of the major historical uses for PGMs was catalytic converters, with platinum used for diesel-powered vehicles and palladium for gasoline-powered ones. The consultancy noted that auto-industry incentives back in 2009 offered several benefits, such as enabling some consumers to buy their first vehicle and driving reductions in average emissions. “Perhaps most importantly, they added fuel to the economic recovery in general, through boosting consumer activity,” Metals Focus said. “Driven by past success and given the devastating impact of the pandemic on the European automotive sector over the past two months, stimulus packages have been accelerated. Compared to previous stimulus plans, the initiatives released recently favor electric and hybrid power trains.” For instance, analysts pointed out that France has set aside €1.3 billion of a €8 billion relief package for the car industry, aiming to both reduce the number of older, more-polluting vehicles and drive consumers toward electric and plug-in-electric vehicles. Germany has been even more specific in in its portion of an economic package for the auto industry. “However, industry bodies have expressed disappointment in the restricted stimulus offerings, which do not cover traditional internal-combustion-engine vehicles, and so Metals Focus caution that they will have a limited impact on demand for PGMs.”

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.