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Independent Singapore
2 days ago
- Automotive
- Independent Singapore
Global carmakers panic as China tightens grip on critical minerals; Trump-Xi showdown looms amid trade war tensions
INTERNATIONAL: Global car manufacturers, including industry titans from Germany, India, and Japan, upstretched red flags this week over China's intensifying control on rare earth mineral exports. According to the latest Reuters report, the restrictions, which now cover rare earth alloys, concoctions, and magnets essential to electric vehicles (EVs) and other advanced manufacturing, have sent tremors through global supply chains. German auto makers joined the clamour on Tuesday, warning of impending production interruptions and economic distraction if the circumstances aren't resolved quickly. 'If the situation is not changed quickly, production delays and even production outages can no longer be ruled out,' said Hildegard Mueller, president of Germany's automotive industry association. The same apprehensions were brought up earlier by Indian EV maker Bajaj Auto, stressing the international scale of the consequence. China's mineral move seen as trade leverage The export restrictions, which came out in April, are generally seen as part of China's tactical play in its continuing trade conflict with the U.S. Under former President Donald Trump, the U.S. levied antagonistic tariffs on Chinese products to rearrange the economic equilibrium. China's reaction, blocking a resource stream central to sectors from automotive to defence, highlights Beijing's influence in the international essential mineral market. See also It's Biden vs rest of Democrats in 1st 2020 debate clash Trump, who is purportedly formulating a new round of trade meetings with Chinese President Xi Jinping, has accused China of breaching international trade standards. 'The administration is actively monitoring China's compliance with the Geneva trade agreement,' said White House spokesperson Karoline Leavitt on Tuesday. Export bottlenecks disrupt global supply chains Since April, deliveries of rare earth magnets have been stuck at Chinese harbours. The interruptions, ascribed to sluggish licensing procedures, have kindled apprehension in capitals from Tokyo to Washington. Attempts are now on track to alleviate the impasse. Emissaries and influential businessmen from the European Union, Japan, and India have appealed for emergency consultations with the Chinese people in power. Japan is sending a business team to Beijing in early June, and India is preparing for a similar visit for car officials within the coming weeks. Automakers urge Washington to act Prominent auto manufacturers, such as General Motors, Volkswagen, Toyota, and Hyundai, recently requested that the U.S. government caution that the scarcity of rare earth magnets could weaken, if not paralyse, their capacity to produce vital equipment. In a letter to U.S. trade bureaucrats, the Alliance for Automotive Innovation wrote, 'Without reliable access to these elements and magnets, automotive suppliers will be unable to produce critical automotive components,' alluding to everything from transmissions and radars to power navigation systems and onboard microchip technology. Frank Fannon, an ex-U.S. State Department official and minerals advisor, cautioned that the predicament has been long in the making. 'We have a production challenge in the U.S.,' Fannon said. 'The time horizon to fix this was yesterday.'
TimesLIVE
3 days ago
- Automotive
- TimesLIVE
Automotive angst as China's critical minerals export curbs take hold
Magnets held up at Chinese ports Shipments of the magnets, essential for assembling everything from cars and drones to robots and missiles, have been halted at many Chinese ports while licence applications make their way through the Chinese regulatory system. The restrictions have triggered anxiety in corporate boardrooms and nations' capitals from Tokyo to Washington as officials scrambled to identify limited alternative options amid fears production of new cars and other items could grind to a halt by summer's end. "If the situation is not changed quickly, production delays and production outages can no longer be ruled out," Hildegard Mueller, head of Germany's auto lobby, told Reuters on Tuesday. Chinese state media reported last week that China was considering relaxing the curbs for European semiconductor firms while the ministry of foreign affairs has said it would strengthen cooperation with other countries over its controls. However, rare earth magnet exports from China halved in April as exporters grappled with the opaque licensing scheme. Frank Fannon, a minerals industry consultant and former US assistant secretary of state for energy resources during Trump's first term, said the global disruptions are not shocking to those paying attention. 'I don't think anyone should be surprised how this is playing out. We have a production challenge (in the US) and we need to leverage our whole of government approach to secure resources and ramp up domestic capability as soon as possible. The time horizon to do this was yesterday,' Fannon said. Diplomats, carmakers and other executives from India, Japan and Europe were urgently seeking meetings with Beijing officials to push for faster approval of rare earth magnet exports, sources told Reuters, as shortages threatened to halt global supply chains. A business delegation from Japan will visit Beijing this month to meet the ministry of commerce over the curbs, and European diplomats from countries with big car industries have also sought "emergency" meetings with Chinese officials in recent weeks, Reuters reported. India, where Bajaj Auto warned further delays in securing the supply of rare earth magnets from China could "seriously impact" electric vehicle production, is organising a trip for car executives in the next two to three weeks. Last month the head of the trade group representing General Motors, Toyota, Volkswagen, Hyundai and other major carmakers raised similar concerns in a letter to the Trump administration. "Without reliable access to the elements and magnets, automotive suppliers will be unable to produce critical automotive components, including automatic transmissions, throttle bodies, alternators, motors, sensors, seat belts, speakers, lights, motors, power steering, and cameras," the Alliance for Automotive Innovation wrote in the letter.
Express Tribune
3 days ago
- Automotive
- Express Tribune
Alarm as China's critical mineral export ban takes hold
Alarm over China's stranglehold on critical minerals grew on Tuesday as global automakers joined their US counterparts to complain that restrictions by China on exports of rare earth alloys, mixtures and magnets could cause production delays and outages without a quick solution. German automakers became the latest to warn that China's export restrictions threaten to shut down production and rattle their local economies, following a similar complaint from an Indian EV maker last week. China's decision in April to suspend exports of a wide range of critical minerals and magnets has upended the supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors around the world. The move underscores China's dominance of the critical mineral industry and is seen as leverage by China in its ongoing trade war with US President Donald Trump. Shipments of the magnets, essential for assembling everything from cars and drones to robots and missiles, have been halted at many Chinese ports while the Chinese government drafts a new regulatory system. Once in place, the new system could permanently prevent supplies from reaching certain companies, including American military contractors. The suspension has triggered anxiety in corporate boardrooms and nations' capitals — from Tokyo to Washington — as officials scrambled to identify limited alternative options amid fears that production of new automobiles and other items could grind to a halt by summer's end. "If the situation is not changed quickly, production delays and even production outages can no longer be ruled out," Hildegard Mueller, head of Germany's auto lobby, told Reuters on Tuesday. Diplomats, automakers and other executives from India, Japan and Europe were urgently seeking meetings with Beijing officials to push for faster approval of rare earth magnet exports, sources told Reuters, as shortages threatened to halt global supply chains. A business delegation from Japan will visit Beijing in early June to meet the Ministry of Commerce over the curbs and European diplomats from countries with big auto industries have also sought "emergency" meetings with Chinese officials in recent weeks, Reuters reported. Reuters
Yahoo
3 days ago
- Automotive
- Yahoo
German auto industry risks production halts over Chinese rare earth export restric
-- Germany's automobile industry could face production delays and potential outages due to China's export restrictions on rare earths alloys, mixtures, and magnets, according to a warning issued by the German auto lobby, VDA. The lobby's head, Hildegard Mueller, highlighted the severity of the issue in a statement on Tuesday, citing slow export license approvals and customs clearance delays as the primary causes of the problem. This is the first time VDA has warned of a potential halt in production due to these issues. The slow granting of export licenses and lags in customs clearances for exports with valid licenses are causing significant issues for automakers. In response to the new rules imposed by China in April, which require exporters to obtain licenses from Beijing, diplomats, automakers, and executives from India, Japan, and Europe are urgently seeking meetings with Beijing officials. Their goal is to push for a faster approval process for rare earth magnet exports. Mueller stressed the urgency of the situation, stating that while some licenses have been granted, it is currently insufficient to ensure smooth production. If the situation does not change quickly, she warned, production delays and even production outages could become a reality. The shortage poses a significant threat to the already strained supply chains of automakers such as Volkswagen (ETR:VOWG_p), Mercedes-Benz (OTC:MBGAF), and BMW (ETR:BMWG), as well as suppliers like Bosch (NSE:BOSH). These companies, among others, rely on rare earths for applications, including motors for electric cars. Related articles German auto industry risks production halts over Chinese rare earth export restric GSK cut to Hold by Berenberg as investors await proof from upcoming drug launches Evercore upgrades Block on lower lending risk and steady consumer trends
Reuters
27-03-2025
- Automotive
- Reuters
German auto shares seen lower after Trump announces 25% tariffs
BERLIN, March 27 (Reuters) - Shares in some German automakers and suppliers were indicated lower in pre-market trade on Thursday after U.S. President Donald announced 25% tariffs on imported vehicles, a move that threatens to hurt Germany's already struggling auto industry. Shares in BMW ( opens new tab were seen 2.3% lower and Daimler Truck ( opens new tab 1.9% lower, according to Lang & Schwarz pre-market data. Shares in parts supplier Continental ( opens new tab were seen 3.9% lower Germany's VDA car lobby slammed the new levies as a "fatal signal" for free, rules-based trade, warning that it would harm companies as well as global supply chains. "The German automotive industry is calling for immediate negotiations between the US and the EU on a bilateral agreement," VDA president Hildegard Mueller said in a statement. Still, research by the IfW economic institute found that Germany would not be the hardest-hit, the FAZ newspaper reported. The institute estimates that German gross domestic product will be 0.18% weaker in the first year after the introduction of the tariffs in real terms, compared with -1.81% in Mexico and -0.6% in Canada. "Overall, the export losses are limited, as cars are often produced close to the sales market," IfW trade economist Julian Hinz said in comments carried by FAZ.
