The magnets in question-neodymium-iron-boron (NdFeB)-are prized for their strength and efficiency

The inventories of rare earth magnets may taper off by mid-July 2025 for certain automotive applications, following China imposing export restrictions and delaying clearance of shipments, according to an ICRA report released on Thursday. 

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 report states.

Jitin Makkar, Senior Vice President at ICRA, said: "The industry, having recovered from the semiconductor supply crunch of 2021-22 that shaved off nearly 100,000 units - or about 4 per cent - from passenger vehicle production, now faces a fresh disruption. 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."

The magnets in question-neodymium-iron-boron (NdFeB)-are prized for their strength and efficiency. They are reserved for high-performance automotive applications such as traction motors in electric vehicles (two-wheelers and passenger vehicles) and power steering motors (in passenger vehicles) in both electric vehicles and internal combustion engine vehicles.