In 2001, Ford Motor Company made one of the most expensive panic buys in corporate history, and it wasn't cars, factories, or technology. It was palladium (Elemingle element #328).

This silvery-white metal, essential for the catalytic converters that clean car exhaust, had become the center of a global supply crisis. Russia, which controlled over 60% of the world's palladium exports, had been delaying shipments throughout the late 1990s, sending prices skyrocketing from around $100 per ounce to nearly $1,100. That briefly made palladium worth more than four times the price of gold, and earned it the nickname “white gold”.

Fearing their production lines would grind to a halt, Ford's purchasing department stockpiled massive quantities of palladium at these record-high prices. But they made a critical mistake: they never consulted Ford's own R&D department, which had already developed new catalytic converter designs that used far less palladium. And they never hedged their bets with futures contracts.

When Russia resumed exports and prices crashed by more than 75%, Ford was left holding a mountain of overpriced metal. The result? A staggering $1 billion write-off in early 2002, one of the largest commodity losses in automotive history.

So the next time you hear about a precious metal, remember: palladium once cost a car giant a billion dollars, not because they couldn't get enough of it, but because they panicked and bought too much!

Learn more: The Wall Street Journal

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