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The Japanese car company Nissan sent the world’s precious metal markets
into a panic last week when the company announced it had developed a catalytic
converter based on palladium rather than platinum. Catalytic converters
use these precious metals to catalyse reactions which remove harmful gases
from car exhausts.

The rush to sell platinum futures may have been premature however. ‘We
can confirm that we have developed the technology,’ says Yukihiro Inagawa
of Nissan. ‘But it’s not true to say that we will be selling cars fitted
with this converter by 1994. We have to do thousands of miles worth of road
testing first, and that could take years.’

After Nissan’s announcement, the price for platinum on London’s bullion
market fell by $27.35 to $365.75 per troy ounce, its lowest price for five
years.

The British materials company Johnson Matthey is the world’s biggest
manufacturer of catalytic converters made from a platinum-rhodium alloy
and currently makes around 20 million a year. A representative for the company
pointed out that Nissan is not claiming an immediate technological breakthrough.
‘As far as we are concerned, platinum-rhodium is the only practical technique
at present.’

In traditional converters, a thin layer of the alloy coats the inside
of the device. The platinum catalyses reactions to remove hydrocarbons and
carbon monoxide as the car’s exhaust passes by. The rhodium removes nitrogen
oxides. The greatest difficulty Nissan encountered was in getting palladium
to remove nitrogen oxides.

Nissan’s earlier prototypes used a palladium-rhodium alloy but the rhodium
content was reduced and the latest converter is mostly palladium, ‘plus
some other elements and some know-how that I don’t want to disclose’, says
Inagawa. The additives aid the removal of nitrogen oxides.

The new converters may not be suitable for use in Europe because speed
limits are higher and engines run hotter. ‘Temperature is a critical factor,’
says Inagawa.

Nissan says its new converter is more advanced than one developed in
1988 by Ford. The American converter, since fitted to 600 000 cars, also
caused a slump in platinum prices.