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Palladium: The Precious Metal Hiding in Your Car
The most valuable part of your car might be a part you have never seen. It sits under the floor, in a metal box on
the exhaust pipe, and inside it is a precious metal rarer than gold. That metal is palladium, and most drivers own
some without knowing it.
Palladium does not get the attention gold and silver do. But it is one of the most important precious metals in the
world, and its price has swung more wildly than almost any of them. Here is what it is, why it ended up in your
engine, and how it stacks up against platinum.
What palladium actually is
Palladium is a silvery-white metal in the platinum family, which is why dealers group it with platinum, rhodium and
iridium as the platinum group metals, or PGMs. On the periodic table it carries the symbol Pd and the atomic
number 46. The chemist William Hyde Wollaston discovered it in 1803 and, after presenting his work to the Royal
Society, named it after Pallas, an asteroid found around the same time.
It is a genuinely rare precious metal. There is far less palladium in the earth's crust than gold, and palladium's rarity
is a big part of its value. At our counter in Bourj Hammoud we buy and sell physical palladium alongside the other
platinum group metals, in forms from bullion bars to scrap, so we watch the price of palladium closely. Right now it
trades near 1,200 dollars a troy ounce, though it has taken a wild ride to get there.
Why it is sitting in your car
Here is the part that surprises people. Over 80 percent of the world's palladium goes into catalytic converters, the
box on your exhaust.
A catalytic converter has one job. It takes the harmful gases an engine produces, such as carbon monoxide, and
turns them into far less harmful ones, such as carbon dioxide, before they leave the pipe. Palladium is the metal
that makes that reaction happen, and no cheap substitute does it as well. A single converter holds only a few
grams, but across the millions of petrol cars built each year, that adds up. It is why the automotive industry, not
jewellers, is the biggest buyer of palladium on earth.
This is also why palladium has a scrap side. When a car reaches the end of its life, recyclers recover the metal
from its converter and return it to the market. When palladium prices spiked a few years ago, that value sadly made
converters a target for theft in many countries. The honest side of the trade is the recycling that quietly puts old
palladium back to use.
Palladium versus platinum
For most of the last century, palladium was the cheaper cousin of platinum. Then that flipped. Around 2018, tighter
rules on petrol engines pushed palladium demand up so fast that its price climbed above platinum, and in March
2022 it hit a record high above 3,000 dollars an ounce, dearer than gold at the time.
It did not last. Carmakers are clever, and platinum can do a similar job in a converter. As palladium grew
expensive, they switched back to platinum where they could. At the same time, electric cars, which have no
exhaust and no converter, began eating into future demand. By late 2023 palladium had fallen below 1,000 dollars,
and the price of platinum is once again the higher of the two.
The short version: palladium and platinum are partly interchangeable, so their prices are tied together, and
whichever is cheaper tends to win the next round of orders.
What moves the price
Two forces set the palladium price, and both are sharp.
On the supply side, Russia and South Africa together account for roughly three quarters of global palladium
production. Palladium mining is that concentrated, so when either country has trouble, the limited supply tightens
fast, and the palladium market is one of the most volatile in precious metals.
On the demand side, it is all about cars. Anything that changes how many petrol engines the world builds, from
emissions rules to the pace of the switch to electric, moves palladium more than it moves gold, since industrial
demand elsewhere is small next to the automotive share. That makes it exciting for traders and risky for savers,
and it is a big reason we always explain the day's rate, set against the London Bullion Market Association
benchmark, before anyone buys or sells.
Where palladium fits for you
Most people who walk in with palladium are holding scrap, a palladium bar, or a coin, or are simply curious after
reading about its price. We handle all of it. Palladium is a real store of value, but it is not a calm one like a gold
coin, so it suits someone who understands that the price can move a long way in a year.
If you want to see how palladium sits next to gold, silver and the rest, our full guide to the types of precious metals
lays them out side by side. And if it is the shine of the platinum family that interests you, its sister metal rhodium is
rarer still, and worth a read.
Common questions
Is palladium rarer than gold?
Yes. There is much less palladium in the earth's crust than gold, and it comes from only a couple of countries, which is part of why its price can jump so sharply.
What is palladium used for besides cars?
Beyond catalytic converters, palladium turns up in electronics and circuit boards, in dental work, in aircraft spark plugs, and in jewellery, where palladium alloys help make white gold white. It even helps purify hydrogen gas. But cars are by far the biggest user.
Is palladium a good investment?
It can hold real value, but it is far more volatile than gold. No one can promise its future performance, so treat this as general information, not financial advice, and speak to a licensed adviser about your own situation.
If you have palladium to sell, or you simply want to know what it is worth today, bring it in and we will weigh it, test it and give you the day's price. There is no cost to ask.