The black market for catalysts
Thieves are increasingly stealing a car part that’s nearly worth its weight in gold and is attached to 98% of cars in America: the catalytic converter. Not only have material prices risen drastically, but the device is getting easier to steal.
Catalytic converters, which reduce cars’ pollution, utilize several rare metals, including palladium (over $2,000 per ounce) and the even pricier rhodium (over $15,000 per ounce). The price of the metals has grown significantly over time, with rhodium, in particular, rising nearly 30x over the last 5 years. Today, a whopping $40B is spent on catalytic converter raw materials.
And while sawing away at the tailpipe section with a hacksaw previously took thieves a while and drew more attention, battery-powered power tools like saws are quickly becoming mainstream as batteries get cheaper and longer-lasting. Metal recycling plants are also increasingly ubiquitous, making it easier than ever to turn sawed-off catalytic converters into cash.
These dynamics have led to a thriving underground market in catalytic converters. This market exists as part of an ongoing arms race between thieves and people who don’t want their possessions stolen. New cars have better security systems, but it’s the older cars that often get targeted: when the metals in catalytic converters were cheaper, manufacturers used less efficient designs that required more raw materials, so a catalytic converter is the rare machine that is more valuable if it’s older.
Car insurance doesn't necessarily cover the cost of a catalytic converter, and for older cars, it's sometimes not even worth replacing since it's such a large proportion of the cost of a car that it’s a better option to buy a separate car. As with other kinds of theft prevention, the goal is not so much to stop a truly determined thief as to make a given car less convenient than other opportunities.
Catalytic converter protection kits are being sold on Alibaba for as little as $30, but being sold directly to consumers for hundreds of dollars. What buyers want is not a DIY project, but the assurance that they've done what they can to prevent theft.