The U.S. Mint is losing money on the very coins it produces.
Currently, it costs the Mint twice as much to make a penny as its face value. A nickel costs the Mint 11 cents. Not surprisingly, it’s looking for alternative metals to use in coins, hoping to reduce its production costs, the Associated Press noted.
After testing a wide array of different metal alloys — 29 in all — the Mint reported to Congress last week that it had failed to identify any that met all its requirement. The metals were test-stamped in coin-pressing machines and then examined for finish, color, hardness and resistance to corrosion and wear. It will run additional tests with another set of alloys next year.
Adjusting the content of metals currently used in coins — the level of nickel used in quarters and dimes, for instance — could lower costs. However, any changes would affect vending machine makers, which would have to recalibrate their machines for the altered magnetic signatures of new coins. That could cost the industry as much as $3.5 billion.
With the government desperate to lower expenses, federal auditors have also proposed ditching the dollar bill and replacing it with a coin to save $4.4 billion over 30 years. However, previous dollar coins went unloved by the public.
The U.S. isn’t alone in its coin-making cost problems. As part of its expense-trimming plans, Canada has decided to stop making its penny.