- WPIC projects automotive platinum demand to soar eight-year high in 2025
- By the end of 2025, an estimated 85 million electric vehicles are projected to be on the road
- Applications for EVs to reach around 3 million ounces in 2025
Harare-The World Platinum Investment Council (WPIC) has projected that automotive platinum demand will soar to an eight-year high in 2025, reflecting a transformative shift in the automotive industry toward cleaner technologies.
WPIC estimates that demand for platinum in automotive applications will reach around 3 million ounces in 2025, marking a substantial rise from previous years.
‘’ As automakers adjust strategies to boost lower-CO2, internal combustion engine-based, hybrid vehicle sales, to mitigate regulatory challenges, automotive platinum demand is projected to strengthen by 2% year-on-year to reach 3,245 koz in 2025—the highest level since 2017’’.WPIC said in its quarterly report.
Automotive Platinum is the use of platinum in vehicles, mainly for its role in reducing harmful discharge.
Major platinum-producing countries are South Africa, Russia, Zimbabwe, Canada, and the USA.
By the end of 2025, an estimated 85 million EVs, including cars, buses, vans and heavy trucks, are expected to be on the road.
South Africa remains the world's largest platinum producer, accounting for 90.1% of global reserves with Anglo American being the world’s largest platinum company.
In Zimbabwe, Zimplats is the country’s largest platinum group metals (PMGs) producing over 500 000 ounces in a year .It is a subsidiary of Impala Platinum one of the biggest platinum producing companies in the world with headquarters in South Africa.
The demand for platinum is projected, driven by the automotive sector and emerging applications in green hydrogen production and sustainable aviation fuel.
As first-world countries are setting ambitious electric vehicle adoption targets and tighten standards for internal combustion engines, platinum's critical role in catalytic converters is becoming more pronounced.
Several factors are contributing to this demand spike, including stringent discharge regulations and the recovery of the automotive sector post-COVID-19, characterized by increased consumer confidence and rising vehicle sales.
While mining companies are expected to ramp up production to meet this demand, challenges such as geopolitical issues and supply chain disruptions pose potential risks to market stability.
Conflicts like the Russia-Ukraine war and the Israeli war in Gaza have led to currency fluctuations.
As a result, investors are investing more in gold than platinum and other minerals mainly because gold is seen as a safe haven during economic uncertainty and is viewed as a more stable investment.
There is a surplus of platinum because production has been high, especially in South Africa, while demand has weakened. This oversupply, along with slower economic growth and changes in the automotive industry has caused platinum prices to drop.
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