What is a Vehicle’s Life Cycle and How Does it Affect the Value of its Converter?

Every vehicle lives a unique life before it’s scrapped, and that affects the amount of platinum, palladium, and rhodium left in its catalytic converter once it enters the recycling stream. That means that even converters with identical serial numbers will end up being priced differently.

We know that a vehicle’s lifecycle and how it affects the value of a converter can feel like information overload. To shed some light on this, we created a video that demonstrates how mileage, maintenance, emission standards, weather, and more affect the value of a converter. Ready to get informed? Check out our video or keep reading.

What Is the Lifecycle of a Vehicle?

A vehicle’s life cycle includes mileage, maintenance, and accidents it’s been through before getting scrapped. This lifecycle also affects the amount of platinum group metals (PGMs) left in a car’s converter. But that’s not all. There are external factors like weather conditions, state/country emission laws, and vehicle dismantling that also affect a converter’s precious metal content. Let’s get into it.

Vehicle Mileage

The more mileage a vehicle has, the less PGMs are left in its converter. That’s because platinum, palladium, and rhodium are catalysts to a reaction called oxidation. This reaction causes the converter to transform harmful pollutants into less toxic emissions. If a vehicle has a high mileage, that means the catalysts have been used more often to transform these toxic emissions.

Automobile Accidents and Converter Incidents

If a vehicle has been damaged in accidents, chances are that the converter was affected as well. Any damage to the underside of the vehicle like hitting bumps or speeding over gravel can damage the converter. Any of these issues can result in the loss of precious metal content in the converter.

General Vehicle Maintenance

It’s important to keep a car maintained and repair any problems as they come up. If you’ve gone to your bi-annual oil & tire changes and vehicle checkups, you’ve not only kept your engine in good shape but also the entire car. Well-oiled engines and well-maintained vehicles run smoothly, while a vehicle that never sees the inside of a garage will eventually feel the consequences, and so will its converter.

Weather Conditions

PGM content in a converter is also affected by the weather conditions the vehicle experiences. For example, idling for a long time depletes the precious metal content in a converter. This means that vehicles in California, which don’t need to idle for a few minutes to warm up, will have converters with higher PGM content than those in North Dakota, where idling is necessary in the harsh winter to defrost the windshield and warm up the motor.

Ice, salt, slush, and grime found in colder and harsher environments also affect PGM content. Exposure to these things can damage the converter and cause ceramic loss.

Emission Laws

Converters are designed to transform harmful pollutants into less toxic gasses, and their PGM content is subject to emission standards. For example, California has strict emission laws, which means every converter manufactured and installed on vehicles sold in that state have high PGM loadings. On the other hand, North Dakota has looser emission standards. That means vehicles sold there have converters with less precious metals than those in California.

Converter Dismantling

When a vehicle reaches the scrap yard, it’s time to retrieve the converter. This process is called dismantling, where recyclers use standard tools and methods to cut the converter from the vehicle. If recyclers remove the converter from the vehicle without using proper tools, then the converter will lose ceramic content. If the center of the converter is cut, hit, or dented during the dismantling process, it will also lose PGM content.

Now that we understand how PGM content varies per converter and how it affects the value of the unit, let’s dive into how the value of a converter is determined.

Establishing the Value of Your Converters with Assay

Keeping in mind what we learned today, the only way to get an accurate price for your converters is by putting your converters through assay analysis. Your processing partner will do that for you and analyze your material with XRF benchtop and ICP devices. You’ll get reliable data like troy ounce figures, metal return percentages, PPMs, and more. When you’re ready to hedge, this information will help you lock in your metal market prices so that you can profit down the line.

It's important to work with a processing partner who understands that each converter, even those with the same serial numbers, experience unique conditions that affect their PGM content. A good partner will equip you with the right knowledge to help you buy and sell profitably and get the most value of your converters. At PMR, all converter lots are put through rigorous assay in order to produce the most reliable results. That’s because we know that informed recyclers make the best choices for their businesses.

For more information, visit PMR's Resource Center.