Overview

• In April, Beijing imposed export controls on seven rare earth elements and related magnets, drastically slowing license approvals and tightening access for European industries.
• German manufacturers in the automotive, electronics, defense and medical technology sectors report production cuts and warn of potential plant shutdowns as component supplies dwindle.
• Volkswagen and BMW say their vehicle output remains unaffected for now, but suppliers like ZF and other component makers are already encountering bottlenecks.
• Companies including Mercedes have begun diversifying their sourcing networks and stockpiling critical materials, yet analysts caution that reducing dependence on Chinese rare earths will require years of investment.
• Industry associations and German officials are urging the European Commission and Commissioner Maroš Šefčovič to enforce the Critical Raw Materials Act and secure faster export licenses from China.