Elon Musk announced this at Tesla’s last shareholder meeting the company was going to produce electric motors without rare earth elements. The American firm has been working on this for years, and already today the engines equipped with the Model 3, compared to those used in 2017, have reduced the presence of certain materials by 25%.

Elon Musk, or rather his head of powertrain development Colin Campbell, who was given the floor by the Tesla CEO during the investor day to discuss the topic, explained that the next generation of Tesla motors will no longer use rare earth cells, even in small amounts. And Tesla will not be alone.

Reduce dependence on China

The absence of rare earth elements in engines is allowed by the manufacturer reduce the cost of production. Added to this are the benefits from an environmental point of view, taking into account CO emissions₂ related to the extraction of these materials.

In addition, there is a more geopolitical issue: dependence on China. Prydnebesna owns 85% of the mining activity and a large part of the supply chain. China can also adopt protectionist policies that oblige those who need certain components to adapt, in particular by affecting prices.

This “subjugation” of Western (and especially American) manufacturers has intensified over the past decade as demand has increased and trade relations between China and the United States have deteriorated.

Towards a more diverse future?

Tesla is not the only manufacturer to introduce permanent magnet motors that do not use rare earth elements. Other brands are working on it, including BMW, Toyota and General Motors. At the moment, these three manufacturers have not yet announced any real news, but it should not be long.

Tesla’s announcement also rattled the markets. Some companies in the sector, such as JL Mag RareEarth or Jiangsu Huanhong Technology Stock, saw their shares fall immediately after Colin Campbell’s statement. The largest producer of rare earth metals outside of China has lost up to 25% of its value.

New types of magnets appear

According to some analysts, Rare earth metals will be used less and less for our electric cars. Manufacturers will try to use magnets of different compositions, precisely so as not to be too tied to external suppliers. William Roberts, an analyst at the consulting firm Rho Motion, goes even further by stating this “the auto industry will choose to use less efficient and less efficient technologies with the sole purpose of reducing costs and relying on different supply chains”.

Ferrite magnets, in which iron is mixed with barium and strontium (more common and less expensive), have already been tested and give encouraging results. General Motors already uses them, and the Japanese company Proterial says it has developed a type of motor with these magnets that is equivalent in performance to conventional motors. Tesla motors, by the way, will use just such magnets.

But the auto industry does not live by isolated cases. The entire sector is working on new chemicals for electric motor magnets, thanks in part to subsidies provided by various governments. For example, the US Department of Energy has provided $17.5 million in research funding for Niron Magnetics, a Minneapolis-based company that is working with Volvo on high-performance magnets that do not contain rare-earth elements.