2 days ago
Supply uncertainty of rare earth magnets from China could weigh auto industry: ICRA
New Delhi [India], : Rare-earth magnet inventories are likely to 'taper off' by mid-July 2025 for the automobile industry, weighed down by the export restrictions from China and ensuing shipment delays, according to a release by rating agency ICRA. "With China tightening export controls and delaying shipment clearances, rare earth magnet inventories are projected to last only until mid-July 2025 for several, if not all, passenger vehicle and two-wheeler applications," Jitin Makkar, Senior Vice President and Group Head - Corporate Ratings, ICRA Industry is looking for contingency options and alternative supply chains, but it is riddled with difficulties. "While the automobile industry is exploring a range of contingency options, each of these appears ridden with logistical, regulatory, and engineering complexities, exacerbating the prevailing uncertainty," the rating agency said."India imported around USD 200 million worth of these magnets for both automotive and non-automotive applications, with approximately 85% of this sourced from China. While the trade value may appear modest, the strategic dependence it reflects is anything but the supply uncertainty has cast a shadow on production planning. The dependence on China for these specialised materials could upend the automobile sector, particularly the fast-growing electric vehicle segment, if the concern remains unresolved." Makkar added.
