Sometimes the best intentions have unforeseen consequences. Take for example the catalytic converter. It was originally designed to be a mechanical method to reduce engine emissions and related air pollution. The success of these units has resulted in them becoming a required part of every automobile in the United States. The emissions controls laws are so strict that any tampering with a certified emissions system must be reported to the government via the car mechanic business that discovers the issue. That being said, a wholly unforeseen consequence has manifested wherein the materials necessary to make catalytic converters have now become more costly than the unit itself.
Definition of a Catalytic Converter
Due to the Environmental Protection Agency’s efforts to improve air quality, catalytic converters were designed to capture and reduce the impact of vehicle emissions generated by the engine’s exhaust. These were first installed on a large scale in the auto production industry in 1975. Catalytic converters are now required to be installed in all combustion vehicles to include mobile construction equipment, buses, cars, and any other licensed gas-powered vehicles. Eventually, emissions that travel through the converter still get emitted into the atmosphere. However, as the emissions pass through the catalytic converter, their elements react with various materials to become far less toxic when they are ultimately released into the air.
Average Part Cost
Going through a certified mechanic, the cost of a legally-obtained catalytic converter varies both on the vehicle and the quality of the replacement part. In some cases, a replacement converter can run anywhere from under $200 to as much as $900. Much of variation depends on the supplier markup as well as who makes the aftermarket replacement part. In terms of service, labor costs run about two hours of work, ranging between $100 and $200 for service time.
The Black Market’s Impact
During 2007 and 2008, commodity prices in U.S. investment markets went through the roof. Due to the fact that a number of commodities were now directly linked to the market, their daily value or spot price climbed sharply as the demand for investment purposes was willing to pay higher prices. The net result was that it drove the cost up for items such as gold and oil.
As it so happens, converters contain small amounts of some of these commodity materials like platinum, palladium and gold. The amounts are minimal because in many cases they are only plated onto the catalytic converter’s internal parts to improve the performance of the unit.
Following the rise of the commodity prices, like-minded recycled parts and scavenging businesses increased in tandem. The unscrupulous side of the markets began sawing off catalytic converters from cars and selling them to willing scrap metal dealers. These dealers turned around and sold the parts to businesses that specialized in removing and recovering the precious metals. Not surprisingly, as the salvage payments dramatically increased, so did the rate of catalytic converter theft.
The Black-market’s Price
When the theft of catalytic converters was at its worst, thieves could reasonably earn $30 for each stolen unit. The cost of catalytic converters went through the roof due to the compounded problems of converter theft and precious metal theft. Now catalytic converters were in demand for replacement in damaged vehicles, as well as for parts. A crafty crook could rip out 10 to 20 catalytic converters in a matter of minutes.
The Cost of Repair
If you were unfortunate enough to be the victim a catalytic converter theft, you were stuck with the cost to replace and repair your vehicle. Depending on your vehicle and who performs the service, you would be facing a repair cost ranging anywhere from $100 to $200 and up. Some mechanics were averaging 15 to 20 converter repairs a day. This only fueled the demand for converters and played a large part in pushing up the price of the unit.
Conclusion
In recent years, the prices for commodity metals have dropped in terms of market worth which has directly resulted in the decreased value of catalytic converters. So for now, this problem has subsided. But it could surely arise again if the valuable metals rise in terms of market worth and unscrupulous people are willing to rip them out of cars again.
Sources:
Sacramento Bee:newspaper article: “Measure Intends to Put Brakes on Metal Thievery”
PressRelease.com: press release for DynaCoverter: “Junk or Scrap Catalytic Converters May be Worth More than People Think”
CityTV: web article: “Catalytic Converter Theft Warning for Car Owners
