The catalytic converter is an exhaust component which cleans the fumes before they exit the system into the air outside. There is a catalyst within the shell of this component which chemically neutralizes some harmful fumes. In many locations around the world, these have been made a legal necessity on vehicles, and some racing vehicles even have them when the series they compete in requires them. Some aftermarket companies make freer-flowing versions, but they are typically not bought often due to the high cost with relatively low power gains, which could be surpassed by simply removing the catalytic converter from the exhaust system altogether.
Catalyst Chemical Raction
Most modern vehicles powered by gasoline are fitted with a "three way" converter. This type converts the three main pollutants in engine exhaust: an oxidizing reaction converts carbon monoxide (CO) and unburned hydrocarbons (HC), while a reduction reaction converts oxides of nitrogen (NOx). This produces carbon dioxide (CO2), nitrogen (N2), and water (H2O) under the proper conditions.
Pictured at the right is a rendering of the catalyst material known as the substrate. It is the important component within the catalytic converter which is contained within the metal casing, and it is made out of costly materials.
Modern automotive fuel is unleaded because lead contaminates and cloggs up the catalist material, which can be seen in the picture at the left, and is bad for both emissions and power. A number of other common vehicle fluids can also damage the catalytic converter and its catalyst material.
Those knowledgable about vehicles tend to recommend fixing problems with the engine before they become bigger and more expensive. The high cost of catalytic converters make them an example of how this method is true, since there are a number of small leak, seal, or sensor problems which could lead to catalytic converter damage later.