Automotive industry groups have raised the alarm over the ramifications of China’s latest move to restrict critical rare earth exports, saying the measures could pave the way to a period of supply chain chaos.
China’s Commerce Ministry last week announced expanded curbs on the export of rare earths and related technologies, seeking to prevent the “misuse” of minerals in the military and other sensitive sectors.
Beijing has since defended the policy, saying it was “not afraid” of a U.S. trade war after President Donald Trump threatened to impose 100% tariffs on Chinese imports.
Despite an agreement in July designed to fast-track shipments to the region, Europe’s auto industry has been experiencing significant disruption after China imposed rare earth export curbs in early April.
The German Association of the Automotive Industry (VDA), the country’s main car industry lobby, said China’s new regulations were expected to have “far-reaching consequences for deliveries of the affected products to Germany and Europe,” as well as for their onward transport.
