The automobile industry has a major impact on the value of both platinum and palladium ETFs. The precious metals are both used in the manufacturing of catalytic converters within automobiles.

The demand for automobiles is down considerably over the past few months, which has put a dent in the recent values of platinum and palladium. ETFS Physical Platinum Shares ETF (PPLT: Profile, Quote, Advanced Chart, News) and ETFS Physical Palladium Shares ETF (PALL: Profile, Quote, Advanced Chart, News) grew during the first four months of the year to all-time highs in April; however, since that time the funds have dropped approximately 13% and 20%, respectively.

Major countries such as the US, Japan, and China have experienced dips in automobile sales, especially in the second quarter of 2010. TheStreet.com reports that US sales declined 10.8% to 982,000 units in June. Sales were well over a million units in previous months. Despite slow automobile production, analysts remain optimistic that there will be a favorable turnaround in the fourth quarter as consumers are motivated by year end incentives.

The chart below illustrates the sharp decline PPLT has suffered since it peaked in April.

To meet demand, ETFSecurities added new shares to its popular platinum and palladium funds on Monday. The new combined value of the funds now rests at $871 million.

ETFSecurities raised the number of shares in the ETFS Physical Platinum Fund (PPLT: Quote, Profile, Advanced Chart, News) to 11.22 million shares, up from 4.78 million, Reuters reports. The firm also created another 5.92 million shares to its ETFS Physical Palladium Fund (PALL: Quote, Profile, Advanced Chart, News) for a total of 18.8 million shares. The new issues should help to contain the possibility of a share price that exceeds its NAV.

The platinum and palladium funds were met with much anticipation on their launch date, securing tens of millions in dollars in assets in just the first few trading days. ETFSecurities’ US based metals funds are now worth a combined $1.5 billion after crossing the $1 billion mark on February 3.

The World Cup trophy isn’t made of platinum, but gold. However, the World Cup games are still expected to crimp the flowing supply of platinum.

The World Cup, which will be held in South Africa, is expected to drain the country of much of its electrical power supply. South African mining operations, which produce much of the world’s supply of platinum, have been fighting with the state-owned ESKOM for access to more electrical power to run their operations. Analysts expect that the World Cup events will put a strain on an already stressed power grid, possibly pushing miners to cease operations through the June and July games, according to TrustNet.

Shamim Mansoor from ETF Securities fears a short black out for mining operations could reduce production and bring about a temporary spike in the price of platinum. For investors, this marks an excellent opportunity to invest in Mansoor’s employer’s exchange-traded fund, the ETFS Physical Platinum Shares (PPLT: Quote, Profile, Advanced Chart, News).

ETFSecurities trip across the Atlantic and into American markets has proven to be a great success. The company has filed to grow its platinum and palladium ETFs with the issuance of new shares ahead of increasing investment demand.

ETFSecurities will issue 6,440,000 new shares for the ETFS Physical Platinum Shares (PPLT: Quote, Profile, Advanced Chart, News) and an additional 5,920,000 new shares for the ETFS Physical Palladium Shares (PALL: Quote, Profile, Advanced Chart, News), according to two SEC filings. Early enthusiasm for exchange-traded platinum funds that began well before the products official launch continues on with both funds soliciting a combined $772 million from investors. The new issues will allow for growth well past the $1 billion mark.

However, investors should expect a brief delay for the new shares filing. Last year the SEC waited several weeks to allow new issues of United States Natural Gas (UNG: Quote, Profile, Advanced Chart, News), despite investor demand that outpaced the number of shares and left the fund to trade with a near 10% premium to its NAV.

While some analysts are calling gold a bubble, others are forecasting where the precious metal will peak. For the first time in nearly two decades, the once boring metal has brought out the best and brightest market forecasters to put their money where their mouth is.

A Bloomberg survey of 22 analysts reveals that 15 are forecasting a run to $1300 an ounce in 2010, which 17% higher than where the yellow metal rests today, BusinessWeek reports. Much like the oil explosion throughout 2008, analysts are taking shots at gold’s peak price. When this happens, investors generally feel the bull run is over, with the bulk of the demand already removed from the market at lower price points.

While gold cools, another precious metal is just heating up. ETFSecurities Platinum ETF (PPLT: Quote, Profile, Advanced Chart, News) has accepted $440 million in assets as investors look for growth opportunities in the automotive sector, which represents the biggest driver of growth for both platinum and palladium, the Wall Street Journal Reports.