The platinum market is a material market of increasing interest, as platinum demand has grown faster than supply in recent years. As a result, the price of platinum has increased, causing end-user firms to experience material scarcity through the presence of these high prices. A significant driver of this demand growth for the last several decades is demand automotive sector, which is responsible for almost 60% of total primary platinum demand, due to the use of platinum in three way catalysts. Platinum is one of the materials utilized to catalyze reactions that prevent vehicle emissions from entering the atmosphere, which can have a severe impact on air quality. Two factors will likely contribute to the future growth of automotive platinum demand: the trend in increased use of platinum per vehicle, and expected growth in the number of automobiles produced and sold around the world. While the automotive market is relatively saturated in developed economies, automotive sales growth potential is particularly high in developing areas, such as BRIC countries. It follows that future growth in automotive platinum demand is likely to be significant. As such, the study aims to characterize the drivers of automotive platinum demand and to establish how this demand sector impacts the platinum market as a whole. This characterization is achieved through regression analysis and by utilizing a platinum market simulation model.
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