August 2020: Automotive demand. Platinum has been used in autocatalysts for over forty years, with automotive demand the single largest demand segment for platinum, accounting for around 40% of annual platinum demand. As a result, investor sentiment towards platinum is heavily influenced by trends in the auto sector, which has had to overcome significant challenges, including the Dieselgate scandal, in recent times.
This year, automakers are feeling the negative impact of the COVID-19 pandemic; in the first half of 2020, global light vehicle sales contracted 28% year on year, with European sales down 43%. Yet behind the headline data, and against a background of tightening emissions legislation around the world, a more detailed examination reveals several automotive themes, including resurgent diesel demand and substitution by platinum for palladium, that point to a more positive outlook for platinum automotive demand than auto sales data alone might suggest.