Tata Motors seeks alternate magnet sources amid China export curbs

Mumbai, Jun 20 (PTI) Tata Motors is working with the government and is also taking steps to procure magnets from alternate sources in the wake of China restricting exports of rare earth elements, company Chairman N Chandrasekaran told its shareholders on Friday.

Responding to queries from shareholders on the impact of China's move to restrict exports of rare earth elements and shortage of magnets, he said, "As of now, this is not a concern, but this is something that we are watching very carefully."

"As of now, we are okay. We are not facing issues...We are able to source the magnets that we need, and also we have plans for having the right level of inventory. We are working with the government. Also, we are working on sourcing from alternate sources," Chandrasekaran noted.

China's restrictions on the export of rare earth elements and related magnets are affecting the domestic auto and white goods sectors.

The automobile industry had sought government support in expediting approvals from the Chinese government for importing rare earth magnets used in various applications, including passenger cars.

To another query on the impact of the ongoing Iran-Israel war on the company's business, he said, "It is very difficult to answer what will be a war kind of situation look like."


However, he said Tata Motors group's three firms -- commercial vehicle, passenger vehicles and JLR -- have a very strong platform.

"They will be able to tide over any of these geopolitical issues in the short term but are completely ready and poised for excellent growth and leverage the opportunity that this industry has to offer," Chandrsekaran asserted.

Earlier in opening address, he said that going forward, volatility will continue to mark economic cycles -- from widespread geopolitical conflicts, military escalations, the redrawing of supply chains and tariff regimes, to AI and energy transition. Nowhere are all these disruptions visible more than in the automotive sector.

"Given the enormous amount of work we have done over the past few years -- from simplifying the businesses to making big strategic bets to strengthening our financial position -- our businesses are structured to not just handle this environment, but to thrive," he asserted.

Responding to a query on passenger vehicle business expansion in international markets, he said, "This is something that we are always in discussions but we are waiting for the right geopolitical environment to be able to launch but we are getting prepared."

To another query on the completion of demerger of Tata Motors' commercial and passenger vehicle verticals into separate entities, Chandrasekaran said, "We think the demerger will happen in the last quarter of this year.

"First, the PV company will list and then the CV company will list a couple of months later. It will happen, in our estimate, sometime around October-November-December quarter.