Auto companies face shortages due to China’s rare-earth restrictions

06 June 2025 - 08:27
By Reuters
Auto parts maker Bosch said bottlenecks in the supply of rare earths were affecting its suppliers, who had to furnish a lot of detailed information to get export licences.
Image: Ethan Miller/Getty Images Auto parts maker Bosch said bottlenecks in the supply of rare earths were affecting its suppliers, who had to furnish a lot of detailed information to get export licences.

Carmakers and their suppliers are facing shortages due to restrictions on Chinese exports of rare earths, minerals and magnets, an issue that has forced some to shut down production of certain models.

Rare earth magnets are used in motors that run electric vehicles and other car parts such as windows and audio speakers.

The companies have paused production or warned shortages were affecting their supply chains.

Suzuki Motor suspended production of its flagship Swift subcompact from May 26, citing a shortage of components.
Image: Supplied Suzuki Motor suspended production of its flagship Swift subcompact from May 26, citing a shortage of components.

Ford shut down production of its Explorer SUV at its Chicago plant for a week in May because of the rare earths shortage.

Suzuki Motor suspended production of its flagship Swift subcompact from May 26, citing a shortage of components. It expects a partial restart on June 13, with full resumption after June 16.

Two people familiar with the matter said the suspension was due to China's restrictions. Suzuki declined to comment on the reason.

Several European auto supplier plants and production lines have been shut down because of a rare earth shortage, Europe's auto supplier association Clepa said on June 4.

BMW said a part of its supplier network was affected by the shortage, but its own plants were running as normal.
Image: Yuriko Nakao/Getty Images BMW said a part of its supplier network was affected by the shortage, but its own plants were running as normal.

Indian carmaker Bajaj Auto warned that further delays in securing the supply of rare earth magnets from China could "seriously impact" EV production by July.

Auto parts maker Bosch said bottlenecks in the supply of rare earths were affecting its suppliers, who had to furnish a lot of detailed information to get export licences.

BMW said a part of its supplier network was affected by the shortage, but its own plants were running as normal.

Maruti Suzuki, India's top-selling carmaker, said there was no immediate impact, and  it was in talks with the government on the matter.

German auto supplier ZF said it sees the effect of a rare earths shortage on some of its suppliers, though it does not procure the raw materials itself.