Rare earths: Chinese export restrictions jeopardize Tesla's Optimus Bot

Tesla's humanoid robot Optimus Bot could have a harder time in the future. Tesla's robot project has suffered a serious blow, claimed Tesla CEO Elon Musk on a conference call in the week before last in April. The reason for this is China's export restrictions on rare earths. These are needed to manufacture key components of the robot.

At the beginning of April, China announced export restrictions on seven rare earths and implemented them in mid-April. This was in response to the punitive tariffs imposed by US President Donald Trump. Rare earth magnets, various permanent magnets that consist largely of ferrous metals and rare earth metals, are also affected.

Without them, the production of new Optimus Bots would not be possible. However, Musk was optimistic that Tesla's plan to manufacture several thousand of Tesla's humanoid robots by the end of 2025 and increase production to one million units by 2030 could still be achieved. Ultimately, however, the most difficult component to obtain will determine the production schedule for the robots.

Possible export license

However, Tesla still has one option: the company can apply for an export license from the Chinese Ministry of Commerce. However, it could take six to seven weeks or even months to process the request.

There are hardly any alternatives for the procurement of rare earths worldwide. China currently dominates the market. Around 90 percent of the world's rare earths currently come from China. The USA itself has only one mine where rare earths are mined – in Mountain Pass in the US state of California. Exploring new mining sites and setting up production is likely to take a long time. Even if this were to succeed and other countries around the world were to massively expand their capacities, China's market share would remain high. The International Energy Agency (IEA) assumes that it would then be 54% by 2030.

(olb)