The rare-earth magnet market has become chaotic because Chinese export restrictions have forced auto manufacturers to rush for these essential components. German magnet manufacturer Magnosphere CEO Frank Eckard reports that desperate car manufacturers contact him for assistance because they face potential factory closures by mid-July.
The entire automotive industry operates in complete state of panic according to Eckard who reports that buyers will pay any amount to obtain their needed supplies. The critical role of Chinese rare-earth magnets in electric vehicles and modern machinery makes this situation extremely severe.
During his Friday address President Trump announced that Chinese President Xi Jinping agreed to restart exports although the specific terms of the agreement remain unclear. The supply bottleneck stands as the main focus of U.S.-Chinese official talks in London but automakers remain concerned about a third major supply chain disruption since the pandemic and chip shortages.
Eckard emphasized that most businesses failed to develop proper strategies for these disruptions even though they experienced previous crises. The current situation depends on Chinese export permit application management by bureaucrats according to Eckard who stated that no one has learned from past disruptions.
