Tag Archives: rare-earth magnets

Who is Afraid of China? the United States Army

Leave a reply

China plans to ease the flow of rare earths and other restricted materials to the U.S. by designing a system that will exclude companies with ties to the U.S. military while fast-tracking export approvals for other firms…The “validated end-user” system, or VEU, would enable Chinese leader Xi Jinping to follow through on a pledge to President Trump to facilitate the export of such materials while ensuring that they don’t end up with U.S. military suppliers, a core concern for China…  The VEU mechanism that Beijing is considering is modeled on U.S. laws and procedures, as is much of Beijing’s export-control architecture.

Under the American version of the VEU system, which has been active since 2007, certain Chinese companies are cleared to buy sensitive goods under a general authorization—essentially a simplified export-approval mechanism—instead of needing individual licenses for each purchase. This makes it easier to import controlled goods such as chemicals or chip-making equipment, but requires companies to put up with U.S. government inspections of their facilities, among other steps, to verify compliance with the program…

Companies in the U.S. and Europe have complained of reduced access to rare-earth magnets from China. Though China has periodically agreed to relax magnet restrictions, Chinese rare-earth magnet exports to the U.S. declined 29% in September 2025 from the month before

Excerpt from Jon Emont et al, China Hatches Plan to Keep U.S. Military From Getting Its Rare-Earth Magnets, WSJ, Nov. 10, 20215

The New Trump Doctrine: Kiss the Hand you Cannot Bite

Leave a reply

Four US major automakers are racing to find workarounds to China’s stranglehold on rare-earth magnets, which they fear could force them to shut down some car production within weeks. Several traditional and electric-vehicle makers—and their suppliers—are considering shifting some auto-parts manufacturing to China to avoid looming factory shutdowns, people familiar with the situation said.

Ideas under review include producing electric motors in Chinese factories or shipping made-in-America motors to China to have magnets installed. Moving production to China as a way to get around the export controls on rare-earth magnets could work because the restrictions only cover magnets, not finished parts, the people said.

If automakers end up shifting some production to China, it would amount to a remarkable outcome from a trade war initiated by President Trump with the intention of bringing manufacturing back to the U.S.  “If you want to export a magnet [from China] they won’t let you do that. If you can demonstrate that the magnet is in a motor in China, you can do that,” said a supply-chain manager at one of the carmakers.

China in April 2025 began requiring companies to apply for permission to export magnets made with rare-earth metals, including dysprosium and terbium. The country controls roughly 90% of the world’s supply of these elements, which help magnets to operate at high temperatures. Much of the world’s modern technology, from smartphones to F-35 jet fighters, rely on these magnets….In May 2025, industry groups representing most major automakers and parts suppliers told the Trump administration that vehicle production could be reduced or shut down imminently without more rare-earth components from China.

Excerpt from Sean McLain et al., Automakers Race to Find Workaround to China’s Stranglehold on Rare-Earth Magnets, WSJ, June 4, 2025

Two days after the publication of this WSJ article, Trump announced, on June 6, 2024, that Xi agreed to let rare earth minerals flow to US (in exchange of? not revoking Chinese student visas? what else?)