By Jason Douglas and Junko Fukutome
There is hope for escaping China's grip on rare earths. That is the message from some companies that toil far from the public eye looking for ways to use fewer of the key minerals dominated by Beijing.
At stake is both military supremacy -- rare earths are used in jet-fighter engines and weapons -- and control over civilian supply chains that currently are hooked on China's minerals. Here are three companies that see another path.
The startup
Niron Magnetics' magnets don't use rare earths. Instead, the basic building blocks are just iron and nitrogen.
The potential of iron-nitride magnets was discovered in the 1950s, but the technology languished for decades because it was hard to create enough magnetic material at scale. A University of Minnesota scientist, Jian-Ping Wang, cracked it a decade ago by using techniques adapted from semiconductor manufacturing to make an ultrathin film.
Niron Magnetics, based in Minneapolis, was formed in 2013 with a grant from the U.S. Department of Energy to commercialize the technology. The government was looking to finance promising alternatives to rare-earth magnets after Chinese friction with Japan over a group of disputed islands prompted Beijing to throttle rare-earth exports to its Asian neighbor -- an early warning shot to the global economy about the coercive potential of China's rare-earth controls.
"The modern world runs on magnets," says Jonathan Rowntree, who joined the company as chief executive in 2023. A car has around 75, in engines, braking systems and even windshield wiper motors. A smartphone has around 18, including in the microphone, camera and sensors. He says demand for magnets is set to rocket with rapidly growing applications such as robotics and the hardware that powers artificial intelligence. "The number of magnets in the world needs to triple in the next 10 years. There's not enough rare earths for it to double. We are in a crisis. We need a reliable and secure magnet supply," he said.
Some scientists have voiced skepticism about the performance of iron-nitride magnets but Niron is confident in its technology. The company is making several tons of magnets a year at a pilot plant in Minneapolis and recently began construction of a much larger site at nearby Sartell, where Rowntree hopes to be making 1,500 tons of magnets a year by 2028. The first commercial sales of a product using Niron's magnets are expected later this year, in high-end speakers produced by a European manufacturer, Rowntree said.
The automotive supplier
ZF Friedrichshafen, a German firm that makes high-tech parts for cars and trucks, has developed a motor for electric vehicles that doesn't use magnets at all.
A typical EV motor uses strong, permanent magnets made from rare earths such as neodymium to spin the rotor and propel the car.
An alternative approach, which has been around in one form or another for more than a century, is to use electricity to create an electromagnet to spin the rotor. That is how giant turbines in power plants operate.
Carmakers including BMW and Renault have developed EV motors that work in the same way, using carbon-graphite brushes that slide against the rotor to feed it electricity. One downside is these tend to be larger than a typical EV motor.
ZF believes it has solved that problem by developing one that works on the same principle but does away with the brushes. Its I2SM motor uses induction -- the same phenomenon that allows you to wirelessly charge a cellphone -- to supply electricity to the rotor. The result is a smaller and lighter motor, without the reliance on rare-earth magnets from China.
"It's an enormous reduction of risk in the supply chain," says Otmar Scharrer, senior vice president for R&D at ZF's E-Mobility division. ZF says it is ready to mass produce the motor for new vehicles; analysts think the I2SM could be under the hood of an EV within a few years.
The steelmaker
Magnets that exploit the properties of rare earths such as neodymium can overheat, making them lose their magnetism in high-tech, high-temperature settings such as vehicle engines. The solution is to add a dose of "heavy" rare earths, which have names like dysprosium and terbium and which allow the magnet to keep working when it gets hot.
China's stranglehold on global rare earths is especially strong in the heavier elements, which are mined in China and few other places. China also dominates rare-earth refining and processing.
Japanese industry got an early lesson in China's coercive power in 2010, when China choked off Japan's access to Chinese rare earths. Today, China is once again squeezing rare-earth supplies to Japan over remarks Japanese Prime Minister Sanae Takaichi made regarding Taiwan.
Following that 2010 wake-up call, engineers at Japan's Daido Steel wondered if there was a way to make magnets that use only "light" rare earths, which are more abundant and mined in places such as Australia. It manufactures neodymium magnets by pouring liquid alloy onto a rotating, cooled disk, then rapidly quenching and pulverizing it to freeze the delicate crystalline structure at a microscopic scale before it can grow.
The result, the company says, is a magnet with comparable performance to a standard permanent magnet without any heavy rare earths at all. Applications include semiconductor manufacturing to MRI scanners to power steering and electric windows in cars. Japanese carmaker Honda is using the heavy-rare-earth-free magnet in some hybrid vehicle motors.
Write to Jason Douglas at jason.douglas@wsj.com and Junko Fukutome at junko.fukutome@wsj.com
(END) Dow Jones Newswires
June 02, 2026 11:45 ET (15:45 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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