To purchase this space contact Gordon

Palladium dropped below $1 000 an ounce for the first time in five years as demand falters amid a slowdown in car sales, the rise of electric vehicles and as users switch to cheaper platinum.

The metal, which is almost entirely used in catalytic converters that curb emissions, has slumped this year as slowing economic growth hurts global auto sales. Tighter monetary policies have also reduced the appeal of precious metals, and hedge funds’ net-bearish bets on palladium futures are near a record.

Palladium demand has also been pressured in recent years after it became much more expensive than sister metal platinum, which has increasingly been used as a substitute in cars. Consumption may further suffer in the longer term as drivers opt for EVs, which don’t have autocatalysts.

Spot palladium dropped as much as 5.5% to $995.03 an ounce by 3:08 p.m. in London. It has slid about 10% this week, with losses accelerating after prices fell below a support at $1 100, sparking more sales by algorithmic traders.

The metal spiked to an all-time high last year as Moscow’s invasion of Ukraine fueled fears that exports from key miner Russia would be disrupted. But the nation’s supplies have largely been rerouted to Asian countries, while South African production has held up well despite power-supply issues there.