Global Alarm Mounts Over China’s Export Curbs on Critical Minerals, Threatening Automotive and Defense Supply Chains

 Concerns over China’s tightening grip on critical minerals escalated on Tuesday, as major automakers across the globe joined U.S. industry leaders in warning of potential production delays and operational shutdowns stemming from Beijing’s sweeping export restrictions on rare earth alloys, compounds, and magnets.

German automakers were the latest to express alarm, echoing warnings issued earlier by an Indian electric vehicle manufacturer. China’s decision in April to suspend exports of a broad spectrum of critical minerals and high-tech magnets has sent shockwaves through industries ranging from automotive and aerospace to semiconductors and defense manufacturing.

The export controls, widely interpreted as part of China’s strategic maneuvering in its ongoing trade standoff with the United States, have disrupted international supply chains and highlighted China’s dominant position in the global critical minerals market. The move is perceived as a form of economic leverage amid intensified trade tensions with U.S. President Donald Trump.

President Trump has made recalibrating the U.S.-China trade relationship a key pillar of his economic policy, enforcing tariffs as steep as 145% on a wide range of Chinese imports in an effort to reduce the trade deficit and revive domestic manufacturing. However, after initial market turbulence, some tariffs were scaled back. China has responded with countermeasures, including its assertive control over exports of indispensable raw materials.

White House Press Secretary Karoline Leavitt confirmed on Tuesday that a high-level dialogue between President Trump and Chinese President Xi Jinping is expected later this week, with China’s mineral export restrictions likely to be a primary focus.

“Our administration is actively monitoring China's adherence to the Geneva trade framework,” Leavitt said, noting ongoing diplomatic engagement with Chinese counterparts.

Experts say the consequences of China’s suspension are already being felt. Shipments of rare earth magnets—crucial for manufacturing products ranging from electric vehicles and consumer electronics to defense equipment—have stalled at Chinese ports pending licensing approval from government agencies. These delays have triggered concern in both corporate boardrooms and national capitals from Washington to Tokyo.

“If this issue is not resolved swiftly, production delays and even outright stoppages may soon become inevitable,” cautioned Hildegard Mueller, President of the German Association of the Automotive Industry (VDA), in an interview with Reuters.

Frank Fannon, a former U.S. Assistant Secretary of State for Energy Resources and current minerals consultant, said the disruption was foreseeable. “No one paying attention should be surprised. The U.S. faces a clear production gap. We need a whole-of-government response to build secure, domestic supply chains. The time to act was yesterday.”

Sources revealed that diplomats and executives from India, Japan, and various European nations are urgently seeking meetings with Chinese officials to press for expedited approvals. Japan has scheduled a high-level business delegation to Beijing in early June, while European envoys from automotive-heavy economies have requested “emergency” consultations in recent weeks.

In India, Bajaj Auto has sounded the alarm, warning that continued delays in rare earth magnet imports could severely impact EV manufacturing. An industry delegation is reportedly being organized to visit China within the next three weeks to address the issue.

In the United States, the heads of major automakers—including General Motors, Toyota, Volkswagen, and Hyundai—have expressed serious concerns in a joint letter to the Trump administration. The letter, issued by the Alliance for Automotive Innovation, underscores the dire implications of disrupted access to critical materials.

“Without stable and timely access to these vital elements and magnets, suppliers will be unable to produce key automotive components, including alternators, automatic transmissions, motors, sensors, seatbelts, lighting systems, and power steering units,” the letter stated.

As the global scramble to mitigate the fallout intensifies, China’s export curbs on critical minerals have emerged as a flashpoint with far-reaching implications for industrial resilience, trade policy, and international diplomacy.