The automotive industry is experiencing the repercussions of China’s rare earth restrictions, particularly impacting electric vehicle manufacturers. Bajaj Auto’s Chetak electric scooter production has taken a hit, with a significant drop in output. Data from SIAM reveals that Bajaj produced 10,824 Chetak scooters last month, marking a 47% decrease compared to July 2024. This production shortfall is attributed to the scarcity of rare earth magnets, essential components for electric vehicle motors, displays, and other systems.
Bajaj Auto had previously warned about the potential impact of this shortage. The company is actively seeking ways to mitigate the issue, including exploring alternative materials and technologies to reduce its dependence on rare earth elements. The drop in production has also led to reduced supplies to dealerships. Despite the challenges faced by Bajaj, other manufacturers such as TVS and Ather Energy, reported growth, highlighting the varying impact across the industry and the need for proactive supply chain management.