When China recently announced that it would cut its exports of rare earth elements if the US went to extremes in the tariff dispute, alarm bells rang in many companies. Urgent inquiries poured in from suppliers of raw materials, who were overwhelmed by numerous orders.
Car manufacturers seem particularly worried. This sector of the economy is already under severe pressure, and now it looks like it will run out of rare earth elements. According to industry insiders, existing stocks will only last until June, Jürgen Pieper, an automotive expert, told public broadcaster ARD.
Cars are now "electronically defined"
This is a problem because modern cars are now unthinkable without computers and electronics. Since the first electric windows appeared in the 1980s, technology has been developing faster and faster, independent automotive expert Christoph Stürmer told the German publication. We are now talking about an "electronically defined vehicle": "This is a car equipped with a central processor that controls many other computers that manage the individual functions in the car." The performance of these processors is enormous, a regular laptop can no longer cope with them, Stürmer points out. And accordingly, the demand is high, the expert adds.
However, we are not yet prepared for a shortage of supplies or a politically motivated shortage of such raw materials, says Pieper in turn. He recalls that this dependence has been known for a long time, but nothing has been done about it: “It has simply never been thought about strategically - both in politics and in large companies”, the expert also says, quoted by ARD.
Direct licensing agreements with China are now being considered to circumvent sanctions. Or production could be increased in other parts of the world. Take, for example, the US interest in Ukrainian raw materials, which is not at all accidental. It is well known that Ukraine also possesses rare earth metals, the German publication recalls in this regard.
Experts want a strategy for rare raw materials
It is difficult to imagine that the trend towards the electronicization of cars will stop or slow down. Meanwhile, in the latest generation of cars, parts are no longer replaced to make them better, but only the software is updated - updates are installed. This is a paradigm shift, points out Christoph Stürmer: "Modern and future cars will actually contain much more electronics and computer technology than today's cars. This is a clear trend."
For a highly industrialized country like Germany, it is good to have its own strategy for raw materials. Moreover, it itself has almost no natural resources. And for one of the leading sectors in the economy, on which the country's prosperity largely depends, such a strategy is extremely important, experts are categorical.
Author: Samir Ibrahim (ARD)