Electric Vehicles Boost Silver Demand

As you see an increasing number of electric-powered vehicles on the road, be aware that those cars and trucks represent growing demand for silver. Because they are powered by electricity and therefore need connections with superb conductivity, electric vehicles require substantially more silver than gas-powered cars and trucks.

EVs rely upon silver for electrical contacts throughout a vehicle’s many electronic systems. This includes switches that turn on and off a vehicle’s power and its accessories, relays that control electronic circuits, circuit breakers, and fuses. Every electrical connection is activated by silver-coated contacts. As a result, electric vehicles use between 25-50 grams of silver each, which is 1.5 to more than 2 times as much silver used in vehicles with internal combustion engines. 

Demand for silver in the automotive industry also includes silver alloys that help to weld steel and aluminum together, and even the silver ceramic lines that defrost windshields.

This widespread use of silver will lead to demand in the automotive industry of nearly 88 million ounces by 2025, up from 50 million ounces in 2000, according to Metals Focus, a leading precious metals consulting firm.

Such growth will help drive industrial demand for silver in the years ahead, and support the market price of silver, an important consideration for investors who are holding the precious metal in their portfolios.