Ford Motor is facing persistent disruptions in its supply of rare earth magnets, Chief Executive Jim Farley said on Friday, as tightened export rules from China continue to challenge Western automakers’ access to key materials.
Speaking to Bloomberg News, Farley described the situation as critical. “It’s day to day,” he said. “We have had to shut down factories. It’s hand-to-mouth right now.”
Ford previously halted production of its Explorer SUV at the company’s Chicago plant for a week in May due to a shortage of rare earth materials, which are essential for manufacturing electric motors and other critical components. The automaker did not immediately respond to a request for comment.
China, which processes more than 90% of the world’s rare earths, introduced new export licensing requirements in April that have constrained supply to Western industries. Although temporary export licenses have recently been granted to suppliers working with major U.S. automakers, including Ford, the relief has not fully resolved ongoing shortages, according to industry officials.
Western nations have stepped up efforts to diversify supply chains, with investments in rare earth extraction and processing in countries such as Australia, Canada, and the United States. Automakers, particularly those expanding electric vehicle production, are among the largest industrial consumers of these materials.