Bajaj Auto, Hero MotoCorp Shares Drop Over 2% as China’s Rare Earth Exports Plummet

Shares of

and Hero MotoCorp fell over 2% each on June 20, following a sharp 53% decline in China’s rare earth magnet exports in May, raising fears of supply chain disruptions for Indian automakers. According to The Economic Times, China’s outbound shipments of rare earth permanent magnets dropped to 1,238 metric tons, the lowest since February 2020, down 74% year-on-year. The plunge follows Beijing’s April 2025 restrictions on exporting seven medium-to-heavy rare earth products and magnets, critical for electric vehicle (EV) motors, semiconductors, and other high-tech applications. With China controlling over 90% of global rare earth magnet supply, the curbs threaten production schedules for companies like Bajaj Auto and Hero MotoCorp, heavily reliant on these components for their EV and two-wheeler segments. Investors remain cautious as the industry braces for potential production delays and cost increases, with no immediate resolution in sight for the supply bottleneck.