With the increased number of hybrid vehicles being produced, some worry that there are not enough valuable resources to go around, while others believe the shortage is simply being exaggerated.

Some people fear that current supplies of neodymium and lanthanum are not sufficient to meet the demand, with Reuters even reporting that the demand will exceed supply by 40,000 tons annually. Neodymium is a rare metal used for the high-power, lightweight magnets in electric motors, and lanthanum is used in nickel metal hydride batteries.

With the call for fewer emissions and more energy alternatives, there has been an increased production of hybrid cars and wind turbines—both of which require these rare metals. According to London’s Telegraph, no substitute has been found for neodymium at this point.

552px-Motors01CJC Neo magnet Ring

Neodymium is a rare earth metal used for the high-power, lightweight magnets in electric motors such as those shown above. Credit: Wikipedia.org

Since Toyota is in control of 70 percent of the U.S. market for alternative fuel vehicles, and the Prius hybrid vehicle is their number one seller, it is no surprise that these projected shortages have caused China, the world’s number one exporter of rare earth metals, to tighten their grip on the precious resources. They are so intent on securing the metals that China’s Ministry of Industry and Information Technology is considering a complete ban on their exportation. According to Reuters, Japanese firms are also trying to secure their share by showing a strong interest in a Canadian rare earth site which is under development in the Northwest Territories.

On the other hand, while many are clearly concerned over the issue, even Toyota has recognized that although the problem must be addressed, it is not an immediate concern. Some people, such as Prabhakar Patil, CEO of Compact Power, say that when compared to other factors that could limit production of electric and hybrid cars, the rare metal supply should not be a very high concern. Although the cost to produce may be increased, Patil believes that automakers will adapt by using induction motors and power electronics instead.

With the richest rare earth deposit in the world lying in Mountain Pass, California, and Canadian mines nearby, U.S. production of hybrid and electric vehicles may indeed be safe, despite China’s reluctance to export the resources. U.S. and Canadian mineral companies are continuing production as planned. So while some may believe the shortage of rare metals used for hybrids is being overstated, it also can’t hurt to plan ahead.

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