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Maruti slams brakes on EV output amid rare earths crisis: report
The carmaker, however, plans to stick with its annual target by stepping up production in the second half of the year
Maruti Suzuki India Ltd, the country’s top carmaker, has slashed short-term output goals for its maiden electric vehicle e-Vitara by two-thirds amid a shortage of rare earth material, Reuters reported, citing an unidentified company document.
The production cut is the latest sign of distress in the local auto industry amid China’s export curbs.
Maruti, which said on Monday it had not seen any impact yet from the curbs, has cut down its production goal for April-to-September to about 8,200 e-Vitaras against its original goal of 26,500, the report said citing the company document.
The auto maker pointed to “supply constraints” in rare earth materials vital to make magnets and other parts across a range of hi-tech industries.
Despite the short-term disruption, the carmaker has kept its target for the full fiscal year to March 2026 unchanged at 67,000 EVs by stepping up production the second half, the report added.
Beijing’s curbs on rare earth exports have hit the global auto industry hard, with some companies warning of severe supply chain disruptions.
Last month, Bajaj Auto Ltd raised concerns about a possible pause in electric scooter production from July because of supply disruptions of rare earth magnets from China.
The company talked about the issue during its fourth-quarter earnings call for FY25, citing unresolved regulatory problems and depleting inventories.
The restrictions have been recently introduced by China and require Indian importers to undergo a new certification process to prove the materials will not be used for military purposes.
The process includes self-declarations by vendors, followed by multi-layered approvals from Indian ministries, the Chinese embassy in India, and local Chinese authorities.
China currently accounts for 80% of the global supply of these magnets, which are essential for electric motors.
While some companies in the US, Europe and Japan are seeing supplies easing as they secure licenses, India is still waiting for China’s nod, Reuters reported.
The slash in EV output may hit Maruti parent Suzuki Motor, for which India is the biggest market by revenue.
A majority of the made-in-India e-Vitaras are earmarked for export by Suzuki to its major markets such as Europe and Japan.
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