news 
Ford’s Production Halted Due to Rare Earth Shortage, CEO Reveals
In a shocking admission, Ford CEO Jim Farley revealed that the company was compelled to temporarily shut down one of its plants last month due to a critical shortage of rare earth minerals. The scarcity of these essential elements has been attributed to China’s recent export controls, which have severely hampered the global supply chain.
According to Farley, the inability to secure a stable flow of rare earths has become a major hurdle for Ford’s production processes. “It’s day to day,” he emphasized in an interview with Bloomberg TV. “We have had to shut down factories. It’s hand-to-mouth right now.”
Rare earth minerals are a crucial component in the manufacturing of various automotive features, including windshield wipers, seat belts, and speakers. Despite their importance, the United States relies heavily on China for its rare earth needs, as approximately 90% of these materials come from the Asian nation.
China’s decision to impose stricter export controls has further exacerbated the issue, leading to a precarious situation for American automakers like Ford. According to reports, companies are struggling to secure approval for their export applications, resulting in an unreliable supply chain.
Ford CFO Sherry House corroborated Farley’s claims during a June conference, highlighting the difficulties faced by the company due to these new restrictions. “There are many components that rare earth minerals are in,” she explained. “And any of those that are coming from China require you to now go through export control. And so there’s an additional layer of administrative process that has to happen.”
The process, however, is not without its challenges. House emphasized that the approval times for these applications can be unpredictable, with some taking longer than others to be processed. “Most frequently, it goes through; it just may take more time,” she clarified.
As a result, Ford is currently managing this cumbersome process, but acknowledges the potential long-term implications of this issue. For now, the CEO remains hopeful that recent developments in U.S.-China trade talks will lead to a resolution and ease supply constraints.
Source: www.cbsnews.com
