Tag - rare earth metal shortage

Key highlights Maruti Suzuki has slashed its e-Vitara production target by two-thirds, reducing output from 26,500 units to 8,200 units for April-September 2025. The shortage stems from China’s export restrictions on rare earth materials, which are crucial for EV motors and high-tech components. Despite the setback, Maruti Suzuki aims to ramp up production in the second half of FY26, targeting 67,000 EVs by March 2026. Maruti Suzuki, India’s largest carmaker, has significantly reduced its near-term EV production targets, citing a global shortage of rare earth metals. The company had initially planned to manufacture 26,500 units of the e-Vitara between April and September 2025, but has now cut that figure to just 8,200 units—a reduction of nearly two-thirds2. China’s export restrictions disrupt global supply chains The rare earth crisis stems from China’s decision to impose export restrictions on key materials, including samarium, gadolinium, terbium, dysprosium, and lutetium. These elements are essential for EV motors, braking systems, and hybrid propulsion. While automakers in the US, Europe, and Japan have begun securing export licenses from Beijing, Indian manufacturers are still awaiting approvals, raising concerns about further production delays. Maruti Suzuki’s strategy to overcome supply constraints Despite the short-term production cut, Maruti Suzuki remains committed to its full-year target of 67,000 EVs by March 2026. The company plans to ramp up output in the second half of FY26, increasing production to 58,728 units, compared to an earlier target of 40,437 units. The e-Vitara is a flagship model in Maruti’s EV strategy, and a significant portion of its production is earmarked for exports to Europe and Japan. Market impact and competitive landscape Maruti Suzuki’s market share in India has slipped to 41%, down from 51% in March 2020, as it struggles to compete with Tata Motors and Mahindra & Mahindra in the EV space. The company is also facing pressure from Tesla, which is set to enter the Indian market later this year. Suzuki Motor Corp., Maruti’s parent company, has revised its India sales target, trimming expectations from 3 million to 2.5 million vehicles by FY31, reflecting the challenges ahead in an increasingly competitive EV landscape. Also read: Tata Motors to launch 7 new models by 2030 in aggressive product push