As a trade war between the United States and China continues, Chinese exports of rare-earth magnets are slowing down, which threatens the manufacturing of a wide range of products, including automobiles. China, which controls over 90 percent of the global processing capacity for magnets, is imposing export restrictions that could further disrupt the auto production.
According to Reuters, the Alliance for Automotive Innovation, which represents many of the world’s biggest car companies including GM, Toyota, Volkswagen, Hyundai, and others, wrote a letter to the Trump administration, warning the White House of the impact of lack of access to these crucial Chinese exports.
“Without reliable access to these elements and magnets, automotive suppliers will be unable to produce critical automotive components, including automatic transmissions, throttle bodies, alternators, various motors, sensors, seat belts, speakers, lights, motors, power steering, and cameras,” the Alliance for Automotive Innovation wrote the Trump administration.
Alliance CEO John Bozzella, a Ford and Chrysler alumnus, said the automotive issue was on the agenda for a meeting between Treasury Secretary Scott Bessent, U.S. Trade Representative Jamieson Greer, and their Chinese counterparts in May. According to Greer, China agreed to lift export restrictions on rare-earth magnets but isn’t moving fast enough to keep up with the pace of auto production.
The exports are slowed down through an opaque application process, sometimes involving hundreds of pages of documents. According to a spokesman from German parts supplier Bosch the process is “complex and time-consuming, partly due to the need to collect and provide a lot of information.”
Hildegard Mueller, the head of the German automotive lobbying group VDA, is also sounding an alarm. “Although some [export] licenses have now been granted, this is currently insufficient to ensure smooth production… If the situation is not changed quickly, production delays and even production outages can no longer be ruled out,” Mueller told Reuters.
“China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US,” President Donald Trump said in a recent social media post. Meanwhile, the Chinese embassy in Washington is accusing the U.S. of abusing semiconductor export controls.
Comments
This is why it’s unwise to transition from an all-ICE mobility model to all-EV. We have an abundance of oil but limited supplies of the rare earth materials required for EVs. To make this shift at this juncture makes us vulnerable to the whims of the Chinese. In my opinion much work must be done on sourcing of materials and upgrading our electrical grid before this shift can occur and it may never be the right option for America.
“Without reliable access to these elements and magnets, automotive suppliers will be unable to produce critical automotive components, including automatic transmissions, throttle bodies, alternators, various motors, sensors, seat belts, speakers, lights, motors, power steering, and cameras,” the Alliance for Automotive Innovation wrote the Trump administration. – Its much bigger than just EV’s
Hmmm, looks like a V8 Camaro with a manual and no nanny sensors isn’t covered then 🤠
Course, that’s not the issue. Utah and Nevada have ample rare earth minerals, and I think it’s believed Wyoming might stock more than China’s African resources combined if we would explore it, but that’s not the point, the point is our politicians have sold us out to €h1n@
True. Reagan years dithering over rare earth mining forced General Motors to sell MaqnaQuench Division to Communist China who controlled the rare earths availability. MagnaQuench developed and produced the world’s most powerful magnets, from rare earth elements.
EVs is the least use of these materials though new to the need. SO whats the solution then? But somehow just EVs are noted. Unbelievable. Open mind open mind.
I mean come on. Is it any surprise they cannot be trusted as a reliable trade partner? Here it is. Out in the open. Their willingness to coerce anyone that stands up to them. Anyone could see this a mile away. Who actually thinks depending on a wolf warrior in sheeps clothing for anything was a good idea when they shake your hand with one hand and hold a knife behind their back with the other? Will people wake up now? There is ZERO reason to trust an authoritarian government interested in tearing down democracies for its own gain. And if you think it will stop here, just wait until open season starts for Taiwan and anyone decides to condemn them the way people rightfully did with Russia.
But don’t worry. There will be people in this country or other countries they are trying to coerce that will defend them to their tomb. And yet, we are worried other countries will stop trading with the US over tariffs when we keep turning a blind eye to these guys. LMAO! Don’t kid me.
The USA is not a reliable trade partner either. Trump is ignoring the existing trade pact (CUSMCA) with his illegal tariffs.
The US doesn’t try to poison their largest trade partners food supply like China just did. Thankfully the FBI stopped the two nationals attempting this. But keep living with your head in the sand defending a government that wants nothing more than to crush you and your family for its own benefit.
Or Mexico with the cartels,
So, what percentage of the general population has ever heard of “rare earth magnets”? Maybe 1/100th of 1%. This will be deemed the next auto manufacturer scam. Even I have never ever heard of them.
Rare earth metals are not rare. They can be mined anywhere. Its just that they (China) are the only ones willing to wreck their own environment to do it en masse. But if they prove to the world they are an unreliable source which is clearly what they are doing, then other countries need to bite the bullet and start sourcing elsewhere. The time is now.
I have a great idea, go back to your roots and quit manufacturing electric vehicles, bidens BS is over. Go back to American Made Muscle.
well said
And also ditch all the computer sensors and all the other unnecessary garbage that we are forced to pay for. How many here can back up a ’59 Cadillac without a backup camera? Let’s get back to grass roots driving again and cut out all the current nonsense. It was so much easier working on a 1960 Ford Falcon compared to a current iPhone car appliance.
imagine if there was a war with China?? Supply chain choke–defeating the US.
Did you see the news? The FBI recently captured two Chinese nationals smuggling in a fungus that can poison crops into the US. And that was on CNN. The supposed “non-biased” news channel.
Now you tell me if we are not at war with them already if they were caught red handed trying to poison our food supply. But don’t worry. People in this country will keep sympathizing with them and calling foul for discouraging doing business with them even if they poison their families.
Just remember. the next time you buy from Temu, or Shein, or that nice and cheap TCL or Hisense tv, or that nice DJI drone or Lenovo laptop, you bought it from the same hands that tried to poison your food. Let that settle for a minute.
Last time I bought a Lenovo (it was a required model for CAD at engineering school) it was trash. I’m never buying another one.
Yeah I had one for a project (an unnamed pharmaceutical company) that required us to use their own laptops for security reasons (the irony considering they were using Lenovos). It had this weird issue where the computer would lock up and crash if I put my iPhone on the base next to the touchpad. Very weird quirk that I mever had with any Dells, HPs, Acers, or Macbooks before.
It’s hard to believe that GM executives could be so stupid and short sighted as to put critical rare earth supply chains exclusively in China’s hands. I worked as a Tier I automotive parts supplier to GM and they always wanted back-up suppliers in case of quality or capacity problems. How did they get so insane with China? We are at “economic war” with China now…. we were before Trump too, but then they were just stealing all the tech they could get their hands on. Crazy….
How about starting tariff war without understanding the repercussions?
I’m really, really glad I sold my GM stock last year. Barra is a fool, obviously she doesn’t understand the automotive business.
its not just GM
Ok but their stock is up $4/share from exactly one year ago…roughly 10%….about the same percentage increase as the NYSE increase from a year ago.
Expect no response from the original opinion, because data !
This is a wake up call that the USA has to start producing its own products again! NO country in the world cares about us when the shit hits the fan…it’s just take take the from the USA…no more screw them all!
Recall it was US companies in the 70’s & 80’s that began using China. As a source for manufacturing parts for US products.
So 50 years later when the overseas supply chain is upset by parts shortages. These companies blame the Chinese government for causing this disruption. Reality is our own companies created this problem and fail to admit their mistakes.
When Is Gm going to give update on the 2025 stop sell of the trucks with 6.2 litre engine trucks .I’ve Been waiting for 3 months for my truck that’s been sitting /locked up in a compound in Texas, I’ve been told for 9 weeks maybe more it’s waiting on a rail car to get shipped to ontario canada ,then to dealership .I just want a answer on what’s happening .
Oh sure stopping EV production will solve all the issues that are the real problems on reliance….oh the haters can’t be big enough. LOL Focus on the real problem. We have lost our manufacturing base like Ross Perot said years ago of that sucking sound of jobs leaving that our CONGRESS ALLOWED on both sides. That is the problem and of course our whining american public about paying to much for this and that because they just gotta have their $7 starbuck lattes. Yet we simply blame EVs. If you thought the same way about your TVs, Cell phones and and and you will still be using ATTs rotary dial…oh wait youd be fine with that too. Moving on…..so is the rest of the world…though forced options should not be either. And dont give me my tax dollar support BS cause you can kindly remove our military from the middle east to support oil flow besides that tiny country as well as ALL the tax breaks 100+year old oil industry still gets even when they make billions of dollars while any incentives for i.e. EV industry is a pittance in comparison to that all. Good grief.
Magnets are used in multiple components in every vehicle, not just EVs.
This is another consequence of not planning properly and the haphazard approach the administration is taking when looking to make changes to international trade.
It’s not surprising that the Chinese are using their near monopoly as leverage in trade negotiations.
Tariffing products that you can’t produce domestically or can’t easily ramp up production for domestically (rare earth metals, and aluminum) means that production will drastically decrease, or prices paid by importers will be passed on, because they can be. Illogical and simplistic solutions to complex resolutions means that the current tarification rate won’t last, i.e. T.a.c.o. It takes 4-8 years to build and staff a new aluminum smelter or rare earth metals processing facility. In the meantime, pay up!
This concern is related to export restrictions, not tariffs.
The reason China has implemented export restriction is because of Trump’s insane tariffs. So yes, this concern is related to tariffs. If there were no crazy Trump tariffs, there would be no rare earth export restrictions.
And why do you think there are export restrictions? Trump trying to manipulate everyone with his haphazard tariffs .
China can F?%K-up the US in so many ways. They’ve been getting ready for war for 30 years while Americans have been blindly financing them.
SAIC China rules gm.
The EV haters jumped in first to comment without understanding that the EV’s are just a small fraction of the products needing the rare earth magnets. The postings pointing to this aspect got downvoted quickly. Same attitude as MTG voting for a bill she admittedly did not read.
Canada has some of the largest known reserves of rare earth minerals in the world. But according to Trump, US doesn’t need anything from Canada, so deal with China instead.