Volkswagen is the biggest automobile company in the world with annual revenues of more than $230 billion. The company sells more than 10 million cars every year. It owns some of the leading brands in the world like Volkswagen, Audi, Bentley, Bugatti, Porsche, and Skoda among others. It is a champion for German manufacturing and is known for the quality of cars it sells. This reputation was put into test in 2015, when the Environmental Protection Agency (EPA) accused the company of violating the clean air act by intentionally turbocharging the diesel engines to activate the emissions during laboratory testing only. In other words, the company cheated the regulators by saying that its cars produced less emissions. In total, the company was forced to pay more than $25 billion in fines from the US. Other countries like Australia and UK also fined the company.
This corporate disaster led to more government regulations as they tried to reduce the amount of carbon emissions from vehicles. In cars, the exhaust fumes are usually controlled by a thing known as a catalytic converter. This converter is made by platinum or palladium, depending on the type of vehicle. Diesel vehicles. The two metals, are good catalysts and are used for hydrogenation and dehydrogenate reactions. This is because hydrogen diffuses through heated palladium, which purifies it.
Platinum is used mostly in diesel cars while palladium is used mostly in gasoline cars. While the two can be used in similar cars, the process for converting them is usually so expensive and so, most manufacturers prefer using each individually.
After the emissions scandal, the diesel cars became particularly unpopular as the diesel cars became more popular. This led to an increased demand for palladium. Since this demand was sudden, the miners could not adequately supply the commodity. As a result, the deficit between the supply and demand has continued to widen. In fact, reports from Russia say that the deficit will continue to widen this year.
The number one lesson in economics is that reducing supplies tend to lead to higher prices while an increasing supply leads to lower prices. Therefore, as the supply of palladium has decreased, it has led to higher prices. The price per ounce of palladium has risen to more than $1400. This makes it the most precious metal in the world. It has beaten gold, which is currently trading at $1330 a ounce. The price is also more than 50% higher than that of platinum, which is trading at $800.
In the short term, the price of palladium will likely continue going up as the demand continue to outweigh the supply. The demand from the jewelry industry will also likely continue to rise as more people move to the more valuable metal. However, there are concerns about the level of theft that is going on around the world as thieves continue to take advantage for the higher price.
There is also another concern about the rise of electric cars. In fact, a number of countries have already announced the plans to phase out combustion engine vehicles. This could affect the demand for the metal in future.
A Quick Look at Palladium, the Most Valuable Precious Metal – Usefultips
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