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West Australian
7 days ago
- Automotive
- West Australian
The West is recycling rare earths to escape China's grip — but it's not enough
As China tightens its grip on the global supply of key minerals, the West is working to reduce its dependence on Chinese rare earths. This includes finding alternative sources of rare earth minerals, developing technologies to reduce reliance, and recovering existing stockpiles through recycling products that are reaching the end of their shelf life. 'You cannot build a modern car without rare earths,' said consulting firm AlixPartners, noting how Chinese companies have come to dominate the supply chain for the minerals. In September 2024, the US Department of Defense invested $US4.2 million ($6.5m) in Rare Earth Salts, a startup that aims to extract the oxides from domestic recycled products such as fluorescent light bulbs. Japan's Toyota has also been investing in technologies to reduce the use of rare earth elements. According to the US Geological Survey, China controlled 69 per cent of rare earth mine production in 2024, and nearly half of the world's reserves. Analysts from AlixPartners estimate that a typical single-motor battery electric vehicle includes around 550 grams (1.21 pounds) of components containing rare earths, unlike gasoline-powered cars, which only use 140 grams of rare earths, or about 5 ounces. More than half of the new passenger cars sold in China are battery-only and hybrid-powered cars, unlike the U.S., where they are still mostly gasoline-powered. 'With slowing EV uptake (in the U.S.) and mandates to convert from ICE to EV formats receding into the future, the imperative for replacing Chinese-sourced materials in EVs is declining,' said Christopher Ecclestone, principal and mining strategist at Hallgarten & Company. 'Pretty soon, the first generation of EVs will be up for recycling themselves, creating a pool of ex-China material that will be under the control of the West,' he said. Only 7.5 per cent of new US vehicle sales in the first quarter were electric, a modest increase from a year ago, according to Cox Automotive. It pointed out that around two-thirds of EVs sold in the U.S. last year were assembled locally, but manufacturers still rely on imports for the parts. 'The current, full-blown trade war with China, the world's leading supplier of EV battery materials, will distort the market even more.' Of the 1.7 kilograms (3.74 pounds) of components containing rare earths found in a typical single-motor battery electric car, 550 grams (1.2 pounds) are rare earths. About the same amount, 510 grams, is used in hybrid-powered vehicles using lithium-ion batteries. In early April, China announced export controls on seven rare earths. Those restrictions included terbium, 9 grams of which is typically used in a single-motor EV, AlixPartners data showed. None of the six other targeted rare earths are significantly used in cars, according to the data. But April's list is not the only one. A separate Chinese list of metal controls that took effect in December restricts exports of cerium, 50 grams of which AlixPartners said is used on average in a single-motor EV. The controls mean that Chinese companies handling the minerals must get government approval to sell them overseas. Caixin, a Chinese business news outlet, reported on May 15, just days after a US-China trade truce, that three leading Chinese rare earth magnet companies have received export licenses from the commerce ministry to ship to North America and Europe. What's concerning for international business is that there are barely any alternatives to China for obtaining the rare earths. Mines can take years to get operating approval, while processing plants also take time and expertise to establish. 'Today, China controls over 90 per cent of the global refined supply for the four magnet rare earth elements (Nd, Pr, Dy, Tb), which are used to make permanent magnets for EV motors,' the International Energy Agency said in a statement. That refers to neodymium, praseodymium, dysprosium and terbium. For the less commonly used nickel metal hydride batteries in hybrid cars, the amount of rare earths goes up to 4.45 kilograms, or nearly 10 pounds, according to AlixPartners. That's largely because that kind of battery uses 3.5 kilograms of lanthanum. 'I estimate that around 70 per cent of the over 200 kilograms of minerals in an EV goes through China, but it varies by vehicle and manufacturer. It's hard to put a definitive figure on it,' said Henry Sanderson, associate fellow at The Royal United Services Institute for Defence and Security. However, there are limits to recycling, which remains challenging, energy-intensive and time-consuming. And even if adoption of EVs in the U.S. slows, the minerals are used in far larger quantities in defence. For example, the F-35 fighter jet contains over 900 pounds of rare earths, according to the Center for Strategic and International Studies, based in Washington, DC. China's rare earths restrictions also go beyond the closely watched list released on April 4. In the last two years, China has increased its control over a broader category of metals known as critical minerals. In the summer of 2023, China said it would restrict exports of gallium and germanium, both used in chipmaking. About a year later, it announced restrictions on antimony, used to strengthen other metals and a significant component in bullets, nuclear weapons production and lead-acid batteries. The State Council, the country's top executive body, in October released an entire policy for strengthening controls of exports, including minerals, that might have dual-use properties, or be used for military and civilian purposes. One restriction that caught many in the industry by surprise was on tungsten, a US-designated critical mineral but not a rare earth. The extremely hard metal is used in weapons, cutting tools, semiconductors and car batteries. China produced about 80 per cent of the global tungsten supply in 2024, and the U.S. imports 27% of tungsten from China, data from the U.S. Geological Survey showed. About 2 kilograms of tungsten is typically used in each electric car battery, said Michael Dornhofer, founder of metals consulting firm Independent Supply Business Partner. He pointed out that this tungsten is not able to return to the recycling chain for at least seven years, and its low levels of use might not even make it reusable. '50 per cent of the world's tungsten is consumed by China, so they have business as usual,' Lewis Black, CEO of tungsten mining company Almonty, said in an interview last month. 'It's the other 40 per cent that's produced (in China) that comes into the West that doesn't exist.' He said when the company's forthcoming tungsten mine in South Korea reopens this year, it would mean there would be enough non-China supply of the metal to satisfy US, Europe and South Korean needs for defence. But for autos, medical and aerospace, 'we just don't have enough.'
CNBC
7 days ago
- Automotive
- CNBC
The West is recycling rare earths to escape China's grip — but it's not enough
BEIJING — As China tightens its grip on the global supply of key minerals, the West is working to reduce its dependence on Chinese rare earth. This includes finding alternative sources of rare earth minerals, developing technologies to reduce reliance, and recovering existing stockpiles through recycling products that are reaching the end of their shelf life. "You cannot build a modern car without rare earths," said consulting firm AlixPartners, noting how Chinese companies have come to dominate the supply chain for the minerals. In September 2024, the U.S. Department of Defense invested $4.2 million in Rare Earth Salts, a startup that aims to extract the oxides from domestic recycled products such as fluorescent light bulbs. Japan's Toyota has also been investing in technologies to reduce the use of rare earth elements. According to the U.S. Geological Survey, China controlled 69% of rare earth mine production in 2024, and nearly half of the world's reserves. Analysts from AlixPartners estimate that a typical single-motor battery electric vehicle includes around 550 grams (1.21 pounds) of components containing rare earths, unlike gasoline-powered cars, which only use 140 grams of rare earths, or about 5 ounces. More than half of the new passenger cars sold in China are battery-only and hybrid-powered cars, unlike the U.S., where they are still mostly gasoline-powered. "With slowing EV uptake (in the U.S.) and mandates to convert from ICE to EV formats receding into the future, the imperative for replacing Chinese-sourced materials in EVs is declining," said Christopher Ecclestone, principal and mining strategist at Hallgarten & Company. "Pretty soon, the first generation of EVs will be up for recycling themselves, creating a pool of ex-China material that will be under the control of the West," he said. Only 7.5% of new U.S. vehicle sales in the first quarter were electric, a modest increase from a year ago, according to Cox Automotive. It pointed out that around two-thirds of EVs sold in the U.S. last year were assembled locally, but manufacturers still rely on imports for the parts. "The current, full-blown trade war with China, the world's leading supplier of EV battery materials, will distort the market even more." Of the 1.7 kilograms (3.74 pounds) of components containing rare earths found in a typical single-motor battery electric car, 550 grams (1.2 pounds) are rare earths. About the same amount, 510 grams, is used in hybrid-powered vehicles using lithium-ion batteries. In early April, China announced export controls on seven rare earths. Those restrictions included terbium, 9 grams of which is typically used in a single-motor EV, AlixPartners data showed. None of the six other targeted rare earths are significantly used in cars, according to the data. But April's list is not the only one. A separate Chinese list of metal controls that took effect in December restricts exports of cerium, 50 grams of which AlixPartners said is used on average in a single-motor EV. The controls mean that Chinese companies handling the minerals must get government approval to sell them overseas. Caixin, a Chinese business news outlet, reported on May 15, just days after a U.S.-China trade truce, that three leading Chinese rare earth magnet companies have received export licenses from the commerce ministry to ship to North America and Europe. What's concerning for international business is that there are barely any alternatives to China for obtaining the rare earths. Mines can take years to get operating approval, while processing plants also take time and expertise to establish. "Today, China controls over 90% of the global refined supply for the four magnet rare earth elements (Nd, Pr, Dy, Tb), which are used to make permanent magnets for EV motors," the International Energy Agency said in a statement. That refers to neodymium, praseodymium, dysprosium and terbium. For the less commonly used nickel metal hydride batteries in hybrid cars, the amount of rare earths goes up to 4.45 kilograms, or nearly 10 pounds, according to AlixPartners. That's largely because that kind of battery uses 3.5 kilograms of lanthanum. "I estimate that around 70% of the over 200 kilograms of minerals in an EV goes through China, but it varies by vehicle and manufacturer. It's hard to put a definitive figure on it," said Henry Sanderson, associate fellow at The Royal United Services Institute for Defence and Security. However, there are limits to recycling, which remains challenging, energy-intensive and time-consuming. And even if adoption of EVs in the U.S. slows, the minerals are used in far larger quantities in defense. For example, the F-35 fighter jet contains over 900 pounds of rare earths, according to the Center for Strategic and International Studies, based in Washington, D.C. China's rare earths restrictions also go beyond the closely watched list released on April 4. In the last two years, China has increased its control over a broader category of metals known as critical minerals. In the summer of 2023, China said it would restrict exports of gallium and germanium, both used in chipmaking. About a year later, it announced restrictions on antimony, used to strengthen other metals and a significant component in bullets, nuclear weapons production and lead-acid batteries. The State Council, the country's top executive body, in October released an entire policy for strengthening controls of exports, including minerals, that might have dual-use properties, or be used for military and civilian purposes. One restriction that caught many in the industry by surprise was on tungsten, a U.S.-designated critical mineral but not a rare earth. The extremely hard metal is used in weapons, cutting tools, semiconductors and car batteries. China produced about 80% of the global tungsten supply in 2024, and the U.S. imports 27% of tungsten from China, data from the U.S. Geological Survey showed. About 2 kilograms of tungsten is typically used in each electric car battery, said Michael Dornhofer, founder of metals consulting firm Independent Supply Business Partner. He pointed out that this tungsten is not able to return to the recycling chain for at least seven years, and its low levels of use might not even make it reusable. "50% of the world's tungsten is consumed by China, so they have business as usual," Lewis Black, CEO of tungsten mining company Almonty, said in an interview last month. "It's the other 40% that's produced (in China) that comes into the West that doesn't exist." He said when the company's forthcoming tungsten mine in South Korea reopens this year, it would mean there would be enough non-China supply of the metal to satisfy U.S., Europe and South Korean needs for defense. But for autos, medical and aerospace, "we just don't have enough."
Yahoo
13-05-2025
- Business
- Yahoo
Here's Why GE HealthCare Stock Blasted Higher Today
An improving U.S./China trading relationship could lift GE HealthCare's earnings outlook. The company is an exporter to China and also sources components from the country. These 10 stocks could mint the next wave of millionaires › A thawing in the U.S./China trading relationship is excellent news for a company like GE HealthCare Technologies (NASDAQ: GEHC). It's a large exporter to China (a market management sees as having excellent long-term potential) and uses Chinese-sourced components in its products. As such, the stock jumped as high as 11.3% in early trading on the news that the U.S. and China have agreed to ease tariffs on each other's goods for an initial 90-day period. The impact of tariffs on GE HealthCare is seen in its earnings guidance. Back in February, management said tariffs would hit its earnings per share (EPS) in 2025 by $0.05. Fast forward to the end of April (almost a month after the "Liberation Day" tariffs were announced), and management discussed an additional $0.80 net hit from the tariffs. For reference, GE HealthCare's current full-year EPS guidance for 2025 calls for $3.90 to $4.10. In addition to a cost impact, GE HealthCare is a major exporter to China, and the country's aim to improve its healthcare provision is a key driver of demand for GE's scanners and imaging equipment. Indeed, management outlined that about $0.65 of the total $0.85 impact on EPS was due to U.S./China tariffs, with CFO James Saccaro noting on the earnings call: "It really goes both ways. We do ship a fair amount of product from the U.S. to China and vice versa." The thawing of the U.S./China trading relationship is excellent news for GE HealthCare and the Chinese healthcare system. It could also lead to investors pricing in improved assumptions for the company's earnings in 2025, which is why the stock is up today. Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $302,503!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $37,640!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $614,911!* Right now, we're issuing 'Double Down' alerts for three incredible companies, available when you join , and there may not be another chance like this anytime soon.*Stock Advisor returns as of May 12, 2025 Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends GE HealthCare Technologies. The Motley Fool has a disclosure policy. Here's Why GE HealthCare Stock Blasted Higher Today was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
12-05-2025
- Automotive
- Yahoo
Tesla Tops $1 Trillion as Tariffs Ease
Tesla (NASDAQ:TSLA) rockets past a $1 trillion market cap as easing trade tensions and a risk-on rally lift shares more than 5% in regular trade. Tesla opened Monday up over 5%, powered by over a 2.5% jump in the S&P 500 on optimism that tariff reductions will unclog global supply chains for automakers and semiconductor suppliers alike. That surge pushed Tesla's market value above the $1 trillion threshold for the first time, cementing its status alongside Apple, Microsoft and other mega-caps. The stock had been under pressure in recent months as steep duties on Chinese-sourced components threatened to derail production economics for Tesla's Cybercab sedan and Semi truck. With duties now set to fall dramaticallyalleviating raw-material and parts costsinvestors are betting Tesla can restore margin on its near-term EV rollout. Tesla's reliance on parts from China, Mexico and Canada means any tariff thaw directly eases manufacturing headwinds. Meanwhile, CEO Elon Musk's invitation to this week's Saudi-U.S. investment forum in Riyadh highlights Tesla's global expansion push, following a recent Middle East launch event that showcased its bestselling EV lineup to an oil-rich audience eager for renewable solutions. Why it matters: Hitting the $1 trillion mark underscores Tesla's resilience amid trade volatility and signals renewed investor confidence in its EV growth trajectory. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
02-05-2025
- Business
- Yahoo
Cimpress PLC (CMPR) Q3 2025 Earnings Call Highlights: Navigating Growth Amid Tariff Uncertainties
Consolidated Revenue Growth: 1% on a reported basis, 3% on an organic constant currency basis. Vista Revenue Growth: 3% organic constant currency growth, with double-digit growth in promotional products, signage, packaging, and labels. Consumer Products Growth: Returned to 5% growth after a decline in Q2. Business Cards and Stationary Category: Declined 3% year over year, an improvement from a 4% decline last quarter. Consolidated Adjusted EBITDA: Declined by $3.5 million year over year. Gross Profit Impact: Affected by a $2.6 million impairment charge and $1.1 million in pre-production startup costs. Operating Expenses: Increased by about $3 million year over year. Tariff Impact: Minimal impact from Canada and Mexico; primary exposure from Chinese-sourced raw materials, with plans to reduce exposure to less than $20 million annually. Guidance Withdrawal: FY 2025 guidance withdrawn due to tariff and trade environment uncertainty. Warning! GuruFocus has detected 4 Warning Sign with CMPR. Release Date: May 01, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Cimpress PLC (NASDAQ:CMPR) reported strong growth in elevated products such as promotional products, apparel, signage, packaging, and labels, which are helping to increase customer lifetime value. Cross Cimpress fulfillment is growing quickly, accelerating new product introductions and lowering costs. Pixartprinting's new production facility in the US is operational, fulfilling for Vista, and will soon launch its US website, marking entry into the US upload and print market. Despite macro headwinds, business performance remains strong in Europe, with consistent growth trends. Efforts to optimize organic search in the US have shown improvement, particularly in March, indicating recovery from previous algorithm changes. Cimpress PLC (NASDAQ:CMPR) faces headwinds in legacy products and channels, reducing consolidated growth rates. Tariffs and the threat of future tariffs create uncertainty, impacting business operations and necessitating mitigation strategies. Consolidated adjusted EBITDA declined by $3.5 million year-over-year, impacted by impairment charges and startup costs. Vista's revenue and profitability in the US are affected by organic search algorithm changes, particularly impacting business cards and stationery. The company has withdrawn its guidance for FY 2025 and beyond due to tariff uncertainties and potential impacts on demand. Q: Which customer verticals are most exposed to tariff impacts, and what percentage of revenue do they represent? A: Robert Keane, CEO, explained that Cimpress serves a diverse range of industries with little concentration in any single vertical. The largest exposure from tariffs is in promotional products, apparel, and gifts (PPAG), which is over 20% of consolidated revenue. The US portion is about 11% of global revenues. The impact is primarily due to sourcing from China, but Cimpress is working on alternative sourcing and price adjustments to mitigate this. Q: What is the expected tariff expense on the remaining $20 million of China COGS, and how will Cimpress manage this? A: Sean Quinn, CFO, stated that the tariff expense on the remaining $20 million of China COGS would be about $29 million. However, Cimpress plans to offset this through pricing changes and alternative sourcing. The impact is expected to be less than the $20 million due to these mitigation efforts. Q: How is Cimpress planning to offset tariff and demand-related impacts by cutting costs? A: Sean Quinn mentioned that Cimpress is prepared to reduce costs if needed. They have already put some constraints in place and can flex variable and semi-variable costs in response to demand changes. The company is maintaining a high bar for growth investments and is focused on cost awareness. Q: Can you provide an update on revenue growth in April and any trends noticed? A: Sean Quinn noted that April's performance was stable compared to March, with no significant changes across regions. The timing of holidays and other factors complicate direct comparisons, but overall trends remain consistent. Q: What gives management confidence in the long-term gross margin profile of the business? A: Sean Quinn emphasized that Cimpress focuses on gross profit rather than gross margin percentage. The company aims to grow gross profit dollars by serving high-value customers well. They have clear objectives, KPIs, and investments to attract and retain these customers, ensuring long-term success. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
