As the demand for recycled materials continues to grow both domestically and internationally, our PGM (Platinum Group Metals) business handles essential precious metals such as platinum, palladium, and rhodium, which are indispensable to the automotive and motorcycle industries.
How can we leverage the strengths cultivated through Honda Group's business to expand our operations? Is there potential to extend these efforts to other manufacturers? We spoke with representatives from the Non-ferrous Materials Division and the Equipment & Environment Division to learn more about the current state of our initiatives and future plans.
*Note: The information is current as of March 2025.
Pursuing Customer Value Beyond Procurement and Supply
Could you tell us about your company's unique approach to recycling precious metals from end-of-life vehicle catalysts and supplying them to catalyst manufacturers?
Kodama: Our division handles platinum, palladium, and rhodiumーprecious metals that are essential to the automotive and motorcycle industries. These Platinum Group Metals (PGM) are used in catalytic converters, which significantly reduce harmful gases in engine exhaust.
We leverage our global network for PGM procurement and supply chain management (SCM), including inventory management, to support Honda and its parts manufacturers worldwide. This is one of our key strengths.
Additionally, based on our extensive experience, we can identify and manage the types and quantities of catalysts required for different manufacturers and vehicle models, allowing us to optimize operations.
Another unique feature of our business is our ability to utilize multiple sourcing options, including mines, chemical companies, financial institutions, trading companies, and recyclers. Given the high cost of PGMs, we provide integrated solutions that consider inventory and financial burdens for catalyst manufacturers, offering customer-focused "one-stop solutions."
Murakami: In the Environmental Business Department, we procure catalysts from end-of-life vehicles through partnerships with dismantlers. Essentially, when dismantlers process vehicles for scrap, we purchase the catalysts from them.
Our partnering smelters then extract PGMs from these catalysts, which are subsequently supplied to the PGM department. The PGM department then provides these precious metals to catalyst manufacturers, ultimately returning them to Honda Group's production processes. This circular initiative has been implemented in Japan, China, and the United States.
Growing Demand for Catalyst Recycling in India and Indonesia
What challenges do you face in building a circular value chain?
Murakami: On a global scale, for example, India has unused or damaged catalysts that are no longer functional. We've started initiatives to recover these catalysts and reintegrate them into automotive production.
India's refining technology is still underdeveloped, and used catalysts were not being traded at fair market prices. By utilizing our scheme, we've made it possible to evaluate these valuable resources appropriately, which were previously discarded as scrap.
Additionally, we've received inquiries from our local subsidiaries in countries like Vietnam, Indonesia, and Malaysia, asking us to recycle catalysts in their regions as well.
- ーRecycling PGMs from end-of-life vehicle catalysts seems like a business that could expand to other automakers. What are your thoughts on this?
- Kodama: With the aim of realizing a circular society and creating price competitiveness of recycled materials, we intend to engage in the recycling and supply of recycled materials without being confined to automobile manufacturers or the automotive industry. The recycled materials we procure from the market are versatile, so if there are businesses interested in our initiatives, we would like to expand our supply destinations.
Expanding Procurement Networks Nationwide
- ーWhat are the challenges and future prospects for procurement within Japan?
- Murakami: Increasing the volume of recovered catalysts is a key challenge. To address this, we are working to build a network with the dismantlers which is said there are more than 1,000 entities across Japan.
Currently, we have procurement sources in regions like Kanto, San'in, and Tohoku in Japan, but we have yet to fully establish networks in western Japan, including Kansai, Chugoku, and Kyushu. Expanding our network nationwide is a primary goal moving forward.
- ーWhat are your thoughts on the use of PGMs in industries beyond automotive, such as hydrogen, electronics, and chemicals?
- Kodama: In the hydrogen sector, PGMs could play a role in future vehicles like fuel cell vehicles (FCVs). I believe the market for FCVs will expand across the entire automotive industry.
In the electronics field, precious metals are used in various applications, such as printed circuit boards. In the chemical industry, PGMs are expected to be utilized as catalysts in petrochemical processes, indicating a broad range of applications. In fact, we've already received inquiries from companies in these sectors.
If you're interested in our initiatives, we'd be happy to discuss opportunities beyond the automotive industry, starting with cost estimation. Beyond cost considerations, we believe we can offer various proposals related to procurement schemes and cash flow management.
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