China’s rare earth cuts behind halt to Swift production, sources say

Tokyo — Suzuki Motor’s suspension of production of its flagship Swift subcompact is due to China’s rare earth restrictions, two people familiar with the matter said, becoming the first Japanese carmaker to be affected by the export curbs.

The small car maker halted production of the Swift, excluding the Swift Sport version, from May 26 citing a shortage of components.

Plans to resume output have been pushed back several times. Suzuki now expected a partial restart of production on June 13 with full resumption after June 16, as the “prospect of parts supply is clearer” now, it said in a statement.

The company declined to comment on the reason for the suspension. The sources declined to be identified as they were not authorised to speak on the matter.

China’s decision in April to suspend exports of a wide range of rare earths and related magnets has upended the supply chains central to carmakers, aerospace manufacturers, semiconductor companies and military contractors.

Alarm over the situation has grown, with global carmakers warning of potential production halts.

Some European auto parts plants have suspended output and Mercedes-Benz is considering ways to protect against shortages of rare earths.

Japan was planning to propose strengthening co-operation with the US on rare earth supply chains in upcoming tariff talks, the Nikkei business daily reported on Thursday.

The Nikkei was the first to report on the reason for the Swift model suspension.

Reuters