China's Rare Earth Restrictions Hinder Optimus Production

Musk: China's Rare Earth Restrictions Hinder Optimus Production

Tesla CEO Elon Musk said production of its Optimus humanoid robots has been impacted by China's restrictions on rare earth magnets.

During an earnings call on Tuesday, he said China wants assurances that the rare earth magnets are not used for military purposes, and the automaker is working with Beijing to obtain an export license for their use.

"China wants some assurances that these magnets will not be used for military purposes, and that's certainly the case. They're just going to go into a humanoid robot," he said, adding that they are not weapons.

This month, China imposed export restrictions on rare earths as part of its comprehensive retaliation to US tariffs, restricting supplies of minerals used in weapons, electronics, and a range of consumer goods.

Analysts said the export restrictions include not only mined minerals but also magnets and other end products that would be difficult to replace. Exporters now have to apply to the Ministry of Commerce for licenses, a relatively opaque process that can take anywhere from six or seven weeks to several months.