90% of palladium demand comes from auto industry
The price of palladium hit near US$1,500 in October 2025, up more than 50% in 2025, the highest since April 2023 — almost mirroring the soaring rise in price of gold — but, this is not just a debasement trade: the global electric vehicle boom is hitting serious speed bumps, and the palladium market, already in deficit since 2012, is responding.
Quite simply: palladium is essential to internal-combustion engines because it sits at the core of modern catalytic converters so stalling electric vehicle (EV) momentum is extending the lifespan of internal combustion engines (ICE) and hybrid vehicles.
This dynamic is sustaining robust demand for palladium in catalytic converters. And, as emissions rules have tightened — for example, from Euro 6 to Euro 7, China 6 to China 7, and, in the US, stricter standards for heavy-duty trucks, including EPA Tier 4 in the US from 2027 — so the required catalyst performance has risen, pushing up palladium loadings per vehicle.
In 2024, an estimated 85-90% of palladium demand comes from the automotive industry.
(the remaining demand is from electronics, medical devices, and chemical processes, with smaller roles in jewelry and investment).
Hybrids reinforce this dynamic: because their engines cycle on and off, catalysts spend more time in “cold start” conditions, forcing manufacturers to use 10–20% more palladium per car than standard ICE models. And hybrid demand is rising.
