Sona Comstar, India’s largest importer of rare earth magnets, has announced plans to start manufacturing these critical components locally, aiming to reduce dependency on China. The move comes as China, which produces about 90% of the world’s rare earth magnets, imposed export restrictions in April in response to U.S. tariffs. While China and the U.S. have recently agreed to fast-track export approvals, many governments and companies are actively seeking alternative sources.
India, with the world’s third-largest car market and the fifth-largest rare earth reserves, is working on a new scheme to promote domestic magnet production. This initiative is designed to boost self-reliance and support industries like electric vehicles.
Gurgaon-based Sona Comstar, officially known as Sona BLW Precision Forgings, is the first Indian company to declare its intention to manufacture magnets locally after the government’s plan became public. “Being the largest importer of rare earth magnets, we are the single largest affected party in the country. We have to look at India’s self-sufficiency on magnets and are working with the government on it,” said CEO Vivek Vikram Singh.
In the last financial year, the company imported 120 metric tonnes of magnets from China to supply gears and motors to clients such as Tesla and Stellantis. Singh stated that Sona Comstar is awaiting final details of the government’s incentives before making a decision on the scale of its investment. He also confirmed that the company is financially prepared for this shift, having increased its revenue fivefold to over $400 million in the past five years.
Although mining and processing rare earths in India will take years, Sona Comstar plans to continue imports to meet rising EV demand. The company had projected the import of 200 tonnes of magnets this year, with electric vehicle customers accounting for about one-third of its revenue.
Currently, 40% of Sona Comstar’s revenue comes from the U.S., followed by India and Europe. With the recent acquisition of the railway business of Escorts Kubota, the company is expanding beyond automotive, expecting most of this year’s revenue to come from India. Sona Comstar is also looking to expand in China, Japan, and South Korea.
Following the sudden passing of Chairman Sunjay Kapur in June, the company has appointed Jeffrey Mark Overly as the new chairman. CEO Singh reassured that the company’s strategy remains unchanged, stating that a strong leadership team is in place to navigate through challenges.
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