The supply-and-demand equation for rare earths

  • 24-Apr-2012 09:56 EDT
Marc Winterhoff.JPG

Roland Berger's Marc Winterhoff was among the speakers at SAE International's Powertrain Electric Motors Symposium for EV and HEVs, an event hosted in conjunction with the SAE 2012 World Congress.

Today’s electrified vehicle powertrains typically rely on rare earth metals, but high prices and availability concerns have many industry insiders rethinking the materials usage landscape.

During Monday’s SAE International 2012 Powertrain Electric Motors Symposium at the Westin Book Cadillac hotel in Detroit, nearly every speaker touched on the topic of rare earths.

Even though rare earths are used under the hood in internal-combustion engines, hybrid electric (HEV) and electric vehicle (EV) applications as well as various passenger cabin accessories for all vehicles, the global production of rare earths, excluding cerium, accounted for just 0.005% of all metals in 2009.

Steel, in contrast, represents 96% of the global production of all metals with China’s share ranging between 50-55%.

“In other words, China’s production of raw steel is equal to more than that of all the rest of the world put together,” said Jack Lifton, Founding Principal of Technology Metals Research LLC.

China also leads in the estimated global reserves of rare earths, followed by Russia, the United States, and India.

According to Marc Winterhoff, Partner with Roland Berger Strategy Consultants LLC, “China has the full value chain available, starting with rare earth materials, within their own country.”

Around the globe, there are numerous deposits of rare earths. Yet only a few mines are expected to start production before 2015, according to Winterhoff.

Malcolm Burwell, North American Director of Technology Development and Transfer for the International Copper Association (ICA), believes rare earths are endangered.

“The bottom line is whatever we do, we’re going to have trouble. There just aren’t enough [rare earths] to feed our appetite in the global automotive industry. As an industry, we’ve often had a wait-and-see attitude, but that’s not going to work this time,” Burwell said.

Other than ignoring the rare earth issue, the auto industry could opt to use less rare earths, or no rare earths.

Yucong Wang, Manager for the Department of Materials Technology at General Motors, said that GM is developing permanent magnets with reduced use—or even no use—of rare earth metals, especially heavy rare earth metals.

GM’s eAssist—available on the Buick LaCrosse and Regal as well as the Chevrolet Malibu Eco—is a light electrification system that includes an induction motor free of rare earth metals.

Matthew Laba, Engineering Group Manager for Electric Motor Development & Validation at GM, said the industry has various e-motor options.

“I don’t think there’s anything that limits alternative construction [away] from rare earth motors. It just happens that a number of current production applications do use rare earth. But other technologies are in production and have been in the past, and will be in the future,” Laba said in a brief interview with an AEI editor.

ICA’s Burwell said a copper rotor induction motor that uses no rare earth materials is “equal or better than the permanent magnet motor in price, performance, and reliability.”

In addition to the EVs from Taiwan’s Luxgen and Tesla Motors' EV models that are using copper rotor induction motors, the Toyota RAV4 EV will join the copper rotor induction motor bandwagon in the coming months.

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