Overview

• China has imposed strict curbs on rare earth exports in response to US tariffs, slowing deliveries of materials essential to electric vehicle batteries.
• Italian car manufacturers report stockpiles lasting only one to one and a half months and have alerted the government about risks of production shutdowns.
• Automakers are now paying premium prices for rare earths as non-Chinese suppliers struggle to compete with state-backed Chinese firms.
• The crisis mirrors the 2020–22 semiconductor shortage, when missing chips forced widespread factory stoppages.
• A 2024 European Commission report found China dominates over 50% of global supply for 19 key raw materials, underscoring strategic vulnerabilities in Western industries.