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Johnson Matthey changes tack as winds turn

The catalytic converter company is looking to hydrogen as exhaust systems look set for the endangered list
Johnson Matthey changes tack as winds turn

As cars with internal combustion engines (ICE) go the way of leaded petrol and the idea of diesel as an environmental saviour, companies that supply parts for gas-guzzling vehicles have to find a way to survive. One such company is Johnson Matthey (JMAT), a specialist in precious metal sciences. It makes most of its money from its catalytic converter sales. But by current forecasts and government policies, most of its major markets for these product may have all-but-disappeared within a decade. As a result the company is changing tack to benefit from the growth of electric vehicles and the anticipated boom of the hydrogen industry, in which it is already an established player. 

Tip style
Risk rating
Medium Term
Bull points

Short-term automaker recovery 

Hydrogen exposure, established expertise

Emissions standards to boost revenues 

Cost-cutting programme in place

Bear points

Weak Covid-19 car industry has hit sales

Investment needed to transition from catalytic converter as main income source

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