GM Flexes Its Rare-Earth Muscles

GM is sitting pretty these days when it comes to rare-earth minerals access compared to other automakers. It might be a slight advantage, now, but later that could change. After all, there’s plenty of uncertainty in the auto industry these days, so even seemingly small advantages could, with the right twists and turns, become a huge plus.  

Trump kills California’s EV mandate for good.

Think back to four years ago and remember one thing that was bottlenecking new car production like crazy: the chip shortage. With modern vehicles requiring several hundred of them, and not in the same design as what’s used in computers, phones, and other electronics, it was an industry disaster.

The same thing could happen with the supply of rare-earth minerals, points out the Detroit Free Press in a new report, thanks to China growing increasingly adversarial towards the West. But GM has secured a supply of the stuff that’s critical for making all kinds of car components, especially when it comes to EVs.

It’s an interesting story, although the recent revelation of a trade agreement Between Presidents Trump and Xi might upend the narrative. Still, it shows GM leadership has been thinking ahead of potential eventualities, a smart move in these uncertain times.

Reportedly, GM started working on the rare-earth mineral situation by forming alliances with two companies that can process them here in the US. China does the majority of that work globally, giving it quite the bargaining chip when it comes to international business.

The only problem is the rare-earth mineral processing facilities in the US aren’t up and running, yet. But spreading out where automakers are getting critical materials seems like a wise managerial decision, so GM should be congratulated for this move.

As the future unfolds, this decision by the auto giant might prove to be rather fortuitous.

Image via GM