According to media reports, a source who participated in Hyundai Motor's investor conference recently revealed that the company holds a rare earth reserve sufficient to last approximately one year. This suggests that Hyundai is unlikely to be immediately affected by global supply chain disruptions stemming from China's export restrictions on rare earth materials.
As the world's third-largest automaker, Hyundai Motor and its subsidiary Kia's rare earth reserves highlight the group's stronger ability to navigate supply chain constraints compared to many of its rivals. Previously, companies such as Ford and BMW have experienced production disruptions or supplier issues due to rare earth shortages.
The source stated that a senior official from Hyundai's investor relations department mentioned that the company enjoys a "greater buffer" than its competitors when it comes to rare earth-related supply chain issues. The executive told investors that Hyundai's efforts to diversify its supply chain and optimize procurement have been effective, and the company expects that production of its electric and hybrid vehicles will be unaffected by supply interruptions for "at least around one year."
The individual also noted that Hyundai significantly increased its stockpile during a recent period in which China slightly relaxed its rare earth export restrictions.
It remains unclear whether the reported stockpile refers solely to reserves held by Hyundai and Kia, or also includes inventory held by their suppliers.
In a statement to Reuters, Hyundai declined to comment on specific stock levels or procurement strategies, saying only: "We continuously assess market conditions to ensure stable operations and maintain a diversified global supply chain. As part of our standard business practices, we maintain adequate inventory levels to support uninterrupted production."
The source also disclosed that Hyundai Motor Group has stockpiled rare earth permanent magnets sufficient to support the production of its core electric and hybrid models for approximately one year.
China supplies about 90% of the world's rare earths, which are critical for automobile manufacturing, particularly for electric vehicle motors.
China's dominance in key mineral resources has become a strategic leverage point in ongoing U.S.-China trade tensions. On June 10, senior economic and trade officials from both countries held a second round of negotiations in London, seeking to resolve the trade dispute that has expanded from tariff issues to rare earth export controls.
