Export restrictions on rare earths imposed by China are increasingly impacting automotive suppliers. The European Association of Automotive Suppliers (CLEPA) announced on Wednesday that some production sites have already been shut down. Since early April, hundreds of companies have applied for export permits, but so far, only a quarter have been approved. Automaker BMW stated that parts of its supply chains are affected by the Chinese restrictions, though its own production is currently running as normal.
CLEPA further explained that many rejected applications have been attributed to procedural reasons, often to a significant degree. The procedures vary from province to province. In addition, companies are being asked to provide sensitive data. The issue could worsen over the next three to four weeks as inventory stocks are depleted.
In April, China decided to suspend exports of a wide range of rare earths and related magnets. These materials are essential for suppliers in the automotive, aerospace, and defense industries, among others.
(Reporting by Victoria Waldersee, edited by Tom Käckenhoff. Edited by Philipp Krach. For inquiries, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and economics) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)
