Scarcity Of Rare Minerals Poses A Threat To BMW

BMW has issued a strong warning that its supplier network will face a significant shortage of rare earth minerals due to China’s tightening of export restrictions. The German automaker notes that, despite the shortage of the mentioned elements, its drives are still working normally, reported Reuters.

The European Automotive Suppliers Association (CLEPA) said several production lines in Europe have been shut down due to shortages of rare earth elements, due to Chinese restrictions.

CLEPA adds that of the hundreds of applications for export licenses submitted by automotive suppliers since the beginning of April, only a quarter have been approved so far, while some have been rejected for “purely procedural reasons.”

According to Tanjug, Beijing’s decision in April to suspend the export of a wide range of rare earth elements and related magnets has shaken supply chains that are crucial, above all, for the production of cars, chips, and aerospace equipment.

The move underscores China’s dominance of the critical minerals industry, crucial to the transition to “green energy,” which Beijing sees as an advantage in its current trade war with the United States, according to Reuters.

China is responsible for producing approximately 90 percent of the world’s rare earth elements.

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