India’s top automaker Mahindra is planning something big. It wants to make rare earth magnets in India — the small but powerful parts used in electric vehicles and electronics.
Why? Because right now, China controls about 90% of the world’s magnet supply. And in April, China limited exports. Some countries, like the US and Europe, are slowly getting supplies again. But India? Still waiting.
That’s not going to work for companies like Mahindra, which just launched two new electric SUVs. They need magnets — and they want to make sure they’re not stuck waiting for China.
A Wake-Up Call for India
This delay has pushed the Indian government to act. Prime Minister Narendra Modi’s team is planning special support to make magnets in India. This includes cash incentives and stockpiling critical parts.
At a government meeting in June, Mahindra said it was open to partnering with a local company or signing long-term supply contracts to produce magnets here. According to sources, Mahindra believes it won’t cost too much to start making them.
Another big player, Uno Minda, also showed interest. It supplies parts to top carmakers like Maruti Suzuki. With China holding back, Maruti has already warned about possible delays in production.
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Sona Comstar and JSW Join the Race
Before Mahindra stepped in, Sona Comstar was already looking to build magnets. It supplies to global giants like Ford and Stellantis.
JSW Steel is also eyeing rare earth mining in India. But mining is more complicated and may take years. The good news? India already has the 5th largest reserve of rare earths. The problem is mining them — and the government controls that.
Right now, most of India’s rare earth output goes to defence and atomic energy. Some of it was being sent to Japan, but India is now planning to stop exports and use the materials at home.
What’s Next for Mahindra?
A final decision depends on two things — how much support the government gives, and how easily companies can get the raw materials.
India is also exploring options abroad. Last year, it sent a team to Myanmar to check resources. It’s also working with Central Asian nations to look for minerals together.
If Mahindra pulls this off, it won’t just be making cars. It will be shaping the future of India’s auto supply chain.
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