Whilst the worldwide automotive business is witnessing a chokehold as a result of uncommon earth magnet import ban from China, Tata Motors has not pressed the panic button, a prime firm official instructed reporters on Tuesday.
“The uncommon earth state of affairs at this level—between stock and alternate sources—we’re okay. We’ll have to attend to see the way it performs out going ahead. There are additionally developments when it comes to China and the EU getting their act collectively on the uncommon earth magnets facet. So, it is transferring at this level. No panic buttons pressed as but, however we’ll have to attend and see how that performs out,” mentioned P. Balaji, Group CFO, Tata Motors.
In line with Balaji, the corporate doesn’t foresee manufacturing curtailment but.
At current, China accounts for over 90% of worldwide uncommon earth magnet manufacturing and processing capability. Since April 4, 2025, China has mandated particular export licenses for seven varieties of uncommon earth parts and completed magnets. This contains requiring detailed end-use declarations and guaranteeing that merchandise are usually not used for defence-related functions or re-exported to international locations just like the US.
The brand new rules have led to important delays, with clearance processes now taking at the least 45 days, inflicting rising backlogs.
Car producers corresponding to Bajaj Auto and TVS Motor have already voiced their considerations relating to EV manufacturing doubtless being hit as a result of uncommon earth magnet disaster. Suzuki Motor Company is going through manufacturing challenges—notably with the Swift mannequin in Japan—as a consequence of China’s restrictions on uncommon earth factor exports. Maruti Suzuki, a subsidiary in India, can be impacted, having to chop manufacturing of its e-Vitara electrical car as a result of similar subject. MSIL has slashed its manufacturing forecast for its upcoming electrical SUV, the e-Vitara, from an preliminary goal of over 26,000 items to roughly 8,000 items by September as a consequence of uncommon earth provide constraints. MSIL goals to fulfill its full-year goal of 67,000 items by ramping up manufacturing later.
As per a report by score company Crisil, China’s restrictions on uncommon earth magnet exports might considerably decelerate India’s automotive sector, notably impacting electrical car (EV) manufacturing. Crisil Rankings mentioned that whereas passenger car volumes are forecast to develop 2-4% in FY26, EV development (anticipated at 35-40%) might soften considerably if provide constraints worsen.
In the meantime, the federal government is reportedly set to launch a brand new initiative with an outlay of ₹1,000 crore geared toward incentivising the home manufacturing of uncommon earth magnets. Uncommon earth magnets are important parts in sectors like electrical automobiles, electronics, and defence.
