NEW YORK (Scrap Register): Palladium has been the most precious of metals so far in 2017 on good demand prospects for use in U.S. auto catalysts, said Mitsubishi in a snippet.
Analysts cited Autodata Corp. statistics showing that car sales in the U.S. surged to a record high in 2016 for the second year in a row, reaching 17.55 million units.
Annualized December sales hit the highest level since July 2005. Although these sales were supported by an average of 10% discounts on retail prices, according to JD Power – the highest since the global financial crisis – the outlook for the auto sector, and therefore palladium demand, remains bright, Mitsubishi added.
President-elect (Donald) Trump’s plans for tax cuts and fiscal stimulus should improve consumer confidence in 2017 and also raise consumer spending on big-ticket items such as cars. Although there are concerns that rising interest rates could restrict car credit availability this year, relatively low gasoline prices should encourage purchases of larger sports utility vehicles -- this sector made up 60% of sales in 2016.
These vehicles typically have higher catalyst loadings than conventional sedans and therefore are positive for palladium offtake. On top of this, a tightening of the most stringent LEV III standards over the next three years will result in generally higher palladium and rhodium catalyst loadings on vehicles for the U.S. market, they added.