Tesla Inc. (TSLA) is confronting hurdles in its ambition to develop humanoid robots due to China's recent restrictions on the export of certain magnets. The halt is impacting the supply chain crucial for these robots, as revealed by CEO Elon Musk during a recent earnings call.
Musk explained that navigating this challenge involves dealing with China's new requirement for an export license to ship magnets vital to their project. China is a dominant player in the global rare earth metals market, responsible for 100% of heavy rare earth metal production and 90% of magnets derived from these materials.
The bottleneck in the supply of these critical components is affecting other industries as well, with companies like Nova Minerals, Ioneer, Lynas Rare Earths, MP Materials, Energy Fuels, NioCorp, and VanEck Vectors Rare Earth/Strategic Metals ETF being significant players in the rare earth element sector. Tesla's efforts to resolve these supply chain issues with China are ongoing as the company seeks to move forward with its humanoid robot development.
