Print 25 comment(s) - last by blueboy09.. on Jan 22 at 10:22 AM

Future Prius vehicles may use new electric motor  (Source: Toyota)
Move comes after China stopped rare earth shipments to Japan for two months

When it comes to hybrids, Toyota sells a significant number of its Prius vehicles globally (the company also sells hybrid variants of conventional models). As a result of its large stake in the hybrid market, Toyota has announced that it is developing a new electric motor for its hybrid and electric vehicles that will cut its dependence on China for rare earth materials.

The move comes after Japan and China had a diplomatic issue that led to China cutting any exports of rare earth to Japan for two months. China currently produces about 97% of the rare earth materials exported all around the world. The rare earth is needed in the electronics industry for making raw components.

China isn't the sole source for rare earth materials, however. The Associated Press reports that the U.S., Canada, and Australia all have sources of rare earth materials as well, but they stopped mining the rare earth in the 1990's because it was cheaper to source if from China. China has about 30% of the total supply of rare earths in the world.

Toyota spokes man Paul Nolasco said, "Toyota is always looking for a reduction in resources and in terms of costs."

According to analysts, the production of EVs and hybrids is still low enough that a loss of rare earth materials for a few months makes for little short-term risk. However, with the number of hybrids and EVs under development this could change in the future making it easy for China to hold rare earth materials hostage and tighten supply to drive prices up.

China is already reducing the amount of rare earths that it ships with production for 2010 reduced by 30% compared to the previous year.

Analyst Ryoichi Saito from Mizuho Investors Securities said, "This isn't a major issue right now, but as these types of cars become more popular, it becomes a big risk if supply is limited or cut off."

Toyota unveiled two new Prius models earlier this month.

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RE: Globalization
By avxo on 1/17/2011 12:25:25 PM , Rating: 5
Not only will they -- some are already in the process of being reopened. Molycorp, for example, has already completed the paperwork needed to restart production at a rare-earth mine in Mountain Pass, California. See for the details.

It didn't make financial sense to mine for rare earths in the U.S. lately, as China exported more than enough at prices that were lower than what was economically viable for U.S. firms. But now, with China reducing exports of rare earth elements coupled with an increased demand worldwide, it was inevitable that mines here (and elsewhere) would reopen.

RE: Globalization
By Nutzo on 1/17/2011 1:36:51 PM , Rating: 5
I wouldn't count on this mine actually opening, especially since it's here in California. I'm sure there are several lawsuits already in the works by environmental groups to stop this.

RE: Globalization
By azcoyote on 1/17/2011 1:43:16 PM , Rating: 4
And those environmental groups will receive tons of cash from China to fight this. Great system we have going isn't it?

RE: Globalization
By Nutzo on 1/17/2011 2:11:10 PM , Rating: 1
Don't know about china, but with the state under complete control of the anti-business Democrats, I'm suprised they even got initial aproval.

RE: Globalization
By The Insolent One on 1/17/2011 4:12:41 PM , Rating: 3
When the Environmentalists can't buy their new fleet of Prius' (Priuses?) (Prii?) to take them to the public hearing to dispute the re-opening of the mine in'll probably sink in.

RE: Globalization
By kattanna on 1/18/2011 10:57:04 AM , Rating: 3
since when has logic and thought ever been a part of crazy?

RE: Globalization
By Drag0nFire on 1/18/2011 1:35:07 PM , Rating: 2
Pluralizing "Prius" - that's a hard one.

Like "platypus": "platypuses" sounds stupid, but "platypi" sounds like something you eat...

RE: Globalization
By Alexvrb on 1/18/2011 8:17:21 PM , Rating: 3
Don't hold your breath. They'll just demand that us peasants abandon the automobile completely in favor of horses, while they keep the ever-tightening supply of rare earth metals to themselves.

RE: Globalization
By sleepeeg3 on 1/18/2011 3:33:35 AM , Rating: 2
When it becomes economically viable - it will open. Capitalism, baby. Beauty of supply and demand.

RE: Globalization
By FITCamaro on 1/18/2011 7:06:58 AM , Rating: 3
It's economically viable to drill for oil here and do many other things. However when the federal government seizes state lands where resources are and designates them nature preserves, nothing can happen on it. Look at the frozen wasteland they just made a polar bear habitat.

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