Carmakers warn rare-earth shortage from China could halt production

Global auto executives are sounding the alarm over an impending shortage of rare-earth magnets from China, which are used in everything from windshield-wiper motors to anti-lock braking sensors, cautioning that it could force the closure of car factories within weeks.

In a previously unreported May 9 letter to Trump administration officials, the head of the trade group representing General Motors, Toyota, Volkswagen, Hyundai and other major automakers raised urgent concerns.

"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 to the Trump administration.

The letter, which was also signed by MEMA, The Vehicle Suppliers Association, added that without those essential automotive components, it would only be a matter of time before U.S. vehicle factories are disrupted.

"In severe cases, this could include the need for reduced production volumes or even a shutdown of vehicle assembly lines," the groups said.

In early April, China announced export control measures on certain items related to seven types of medium and heavy rare earths, citing the need to safeguard national security and interests and fulfill non-proliferation and other international obligations.

At a press conference last Friday, Foreign Ministry spokesperson Lin Jian said China is willing to strengthen dialogue and cooperation in the field of export control with relevant countries and regions and stay committed to maintaining the stability of global production and supply chains.

China's export control measures align with international norms and are not discriminatory nor targeted at any specific country, he said.

(With input from Reuters)