Summary
A shortage of rare-earth metals has affected the production of Bajaj Auto's Chetak electric scooters in India. This shortage is due to export restrictions by China and is impacting the broader electric vehicle (EV) sector in India. Companies are trying to adapt by redesigning products and sourcing materials differently.
Key Facts
- Bajaj Auto's production of the Chetak electric scooter was cut nearly in half in July due to rare-earth metal shortages.
- Rare-earth metals include 17 elements like dysprosium and terbium and are mainly processed in China.
- China introduced export restrictions on rare-earth metals after the United States announced tariffs.
- Bajaj Auto redesigned some motors to use lighter rare-earth magnets to counter the shortage.
- The shortage affects the entire automobile industry in India, which relies heavily on these metals.
- India’s EV sales were over 2 million in 2024, a 24% increase from 2023.
- Electric car sales in India more than doubled their market share from 1% to 2.6% recently.
