General Motors’ early move to secure U.S.-made rare-earth magnets has put it ahead of rivals as China tightens export controls.
General Motors is emerging as a rare winner in the escalating U.S.–China trade tensions after Beijing imposed new limits on rare-earth magnet exports, putting pressure on automakers that rely heavily on Chinese supplies for electric motors and other components.
The stock is up nearly 2.6% in overnight trading on Sunday, according to Yahoo Finance, poised to open the fresh trading week on a strong note.
Willis Thomas, a critical-minerals analyst at CRU, said GM “looks like a genius today” for its 2021 decision to invest in domestic rare-earth magnet production. The move, made when most automakers were still dependent on China, now gives GM a significant advantage as supply chains tighten, according to a report by The Wall Street Journal.
The Detroit automaker’s early bet secured access to American-made magnets through partnerships with VAC, MP Materials, and Noveon, part of a broader push to localize key components and reduce reliance on foreign suppliers.
As China’s new rules expand export controls to include manufacturers abroad that use Chinese-sourced materials, GM’s domestic partnerships have positioned it ahead of peers still dependent on Beijing’s supply chain.
GM began its rare-earth sourcing initiative during the pandemic, when global supply disruptions exposed vulnerabilities in overseas production. “You start recognizing the lack of resiliency is much more costly,” said Shilpan Amin, GM’s head of global supply chain, in 2021.
VAC’s new South Carolina facility and MP Materials’ California plant are both expected to begin production later this year, supported by a $400 million Pentagon investment in MP Materials. These partnerships are set to make GM the only U.S. automaker with large-scale access to domestic rare-earth magnets.
Thomas cautioned that while GM’s approach offers stability in the near term, it could become costly if trade restrictions are eventually lifted. “If the events turn the other way, and there is a free-trade agreement that took off all the tariffs and quotas, that has them paying through the nose for something you’re locked into,” he said.
Even so, Amin said GM’s early positioning gives it “a first mover’s advantage” that should last as competition for non-Chinese rare earths intensifies.
On Stocktwits, retail sentiment for General Motors was ‘bullish’ amid ‘low’ message volume.
One bullish user said that Americans could weather the latest Sino-U.S. trade standoff by cutting back on Chinese goods, saying consumers had “stocked up enough” to last for years.
Another user warned that if U.S. President Donald Trump reignites a full-scale tariff war with China, markets could tumble as much as 20% to 30% over the next few months.
General Motors’ stock has risen 4.8% so far in 2025.
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