STORY: Car executives have once again been driven into their war rooms.
They’re concerned that China’s tight export controls on rare-earth magnets – crucially needed to make cars – could cripple production.
Cars today use rare-earths-based motors in dozens of components.
They include side mirrors, speakers, oil pumps, wipers, and sensors for fuel leakage and braking sensors.
Electric vehicles use more rare-earths than combustion engine cars.
Industry leaders are worried that the situation could become the third massive supply chain shock in five years.
A semiconductor shortage wiped away millions of cars from production plans between 2021 and 2023.
Before that, the pandemic shut factories for weeks.
This time, as the rare-earths bottleneck tightens, the industry has few good options.
That’s because China dominates the market.
It controls around 70% of global rare-earths mining, 85% of refining capacity and about 90% of rare-earths metal alloy and magnet production, according to industry data.
The fate of automakers’ assembly lines has been left to a small team of Chinese bureaucrats as it reviews hundreds of applications for export permits.
In Europe, the region’s auto supplier association says several plants have already shut down, with more outages coming.
