China's rare earth curbs put Europe's auto industry at risk, Italian lobby says

Core Insights - Expected new Chinese curbs on rare earth metal exports could significantly impact the European auto industry due to low reserves of these materials [1][2] - Despite a July agreement to expedite shipments to Europe, China continues to maintain tight control over rare earth exports, recently announcing expanded curbs [1][2] - The rare earth metal industry, although valued at below $5 billion globally, is crucial for electric motors and other vehicle components, and its constraints could slow down the entire global auto industry [2][3] Industry Impact - The Italian auto part maker lobby ANFIA highlighted that manufacturers had previously managed to maintain production despite supply curbs, but current reserves of rare earth metals are now depleted [2] - The depletion of reserves means that the buffer that previously existed for manufacturers is no longer available, raising concerns about future production capabilities [2] Market Dynamics - China refines and processes the majority of the world's rare earths, which are essential for various industries, including automotive manufacturing [2] - The auto industry relies on rare earths for critical components, indicating that any disruption in supply could have widespread repercussions [3]