Maruti Suzuki, India’s largest carmaker, stated on Monday that there is no immediate impact on its production from China’s recent export controls on rare earth magnets, even as industry-wide concerns continue to grow over potential disruptions, Reuters reports.
The company, which is preparing to launch its first electric vehicle (EV) in India this year, confirmed it has applied for the necessary import license required under China’s new regulations. These rules, introduced in April, mandate that companies obtain permits for importing rare earth magnets, including documentation such as end-use certificates to ensure the materials are not used for military purposes.
“It is not a restriction. It is an endorsement of end use,” said Rahul Bharti, Maruti Suzuki’s Senior Executive Director for Corporate Affairs.
He added that the company is awaiting the outcome of its application and will notify stakeholders, including the stock exchange, if any significant production issues arise.
Despite the company’s public assurance, sources familiar with the situation told Reuters that Maruti had indicated during a meeting with the Ministry of Heavy Industries that production of one of its car models could be affected as early as June if the licensing process is not resolved promptly.
Rare earth magnets are critical components in automotive manufacturing, especially in electric vehicles. China currently dominates global processing of these materials, controlling over 90% of capacity. The added bureaucratic requirements and approval steps—by both Indian and Chinese authorities—have led to mounting concern within the Indian auto industry.
Last week, manufacturers informed government officials that vehicle production could stall within days due to dwindling inventories. The Society of Indian Automobile Manufacturers warned that parts suppliers might exhaust their magnet stock by the end of May, potentially bringing production to a halt in early June.
In response, India’s Heavy Industries Minister H.D. Kumaraswamy said the government plans to send a delegation of industry representatives to China within the next two to three weeks to discuss the new import protocols and seek clarity from Chinese authorities.
For now, Maruti maintains that the upcoming launch of its electric SUV, the e-Vitara, remains on track and is unlikely to be materially affected by the supply situation. However, the automaker acknowledged that it cannot comment definitively on future production impacts until its import application is processed.
