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Will electric vehicle uptake in America dent PGM demand?

President Biden’s push to accelerate the nation’s transition towards electric vehicles (EVs) is a risk to autocatalyst palladium demand in the US. Momentum in the EV market has so far been driven by China and Europe, but 2021 is being branded as the breakout year for EVs in the US. The Biden administration has made EVs a priority with tax incentives and government funding. In addition, quite a number of new EV models are being launched in the US this year.

Can VW’s ID.4 make EVs mainstream in the US? The roll-out of Volkswagen’s ID.4 this year will launch the first affordable mass-market electric compact SUV from an established OEM. Compact SUVs are one of the fastest-growing segments in the car market. North America’s EV sales are currently dominated by Tesla, but this is expected to change in coming years as competition from other manufacturers increases. If demand for these EVs takes off, 2021 could signal the start of a genuine shift towards clean mobility in the US.

However, barriers to EV uptake remain. Beyond the appeal of having more models to choose from, will EVs suit consumers’ lifestyles? Driving range, availability of charging infrastructure and high prices could all be a concern. For OEMs, issues over security of battery supply are another problem. Earlier this year, the US International Trade Commission imposed a 10-year import ban on South Korean battery-maker SK Innovation, which could impact Ford and VW’s American EV plans over the next few years. The outlook in Europe is more positive, with Ford investing $1bn in EV production at its plant in Cologne, Germany, as it targets an all-electric offering for passenger vehicles in Europe by 2030. …

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