Apple aims to bolster US supply chain with $500 million deal with MP Materials for rare earth magnets

Apple and MP Materials have entered a $500 million agreement aimed at enhancing the US supply chain for rare earth materials, which are essential for manufacturing advanced technology like smartphones, electric vehicles (EVs), and renewable energy systems. The deal, announced on July 15, will involve the development of new manufacturing and recycling facilities in Texas and California, reinforcing Apple’s ongoing commitment to American manufacturing and sustainability.

Under the agreement, Apple will purchase US-made rare earth magnets from MP Materials’ flagship facility in Fort Worth, Texas. The magnets, which are critical for the production of electronic devices, will be produced using cutting-edge manufacturing techniques designed specifically for Apple products. The Fort Worth facility will include new neodymium magnet manufacturing lines, boosting MP Materials’ capacity to meet rising global demand for these essential materials.

Boosting domestic magnet production and recycling capacity

In addition to the magnet manufacturing expansion in Texas, the two companies will collaborate on establishing a new rare earth recycling line in Mountain Pass, California. This facility will focus on recycling rare earth elements from used electronics and post-industrial scrap, creating a more sustainable loop for critical materials. Apple has been a leader in integrating recycled rare earth materials into its products. The company first introduced recycled rare earth elements into the Taptic Engine of the iPhone 11 in 2019, and now nearly all magnets in its devices are made with 100 per cent recycled rare earths.

MP Materials, the only fully integrated rare earth producer in the United States, has been critical to reducing US dependence on China, which controls most of the global supply of rare earth elements. The new partnership will further solidify the US as a key player in the global rare earths market and help address the strategic challenge of securing domestic sources for these critical materials. MP Materials has already agreed to a multibillion-dollar deal with the US Department of Defense to ramp up rare earth production, and the new deal with Apple is expected to strengthen that initiative.

“American innovation drives everything we do at Apple, and we’re proud to deepen our investment in the US economy,” said Apple CEO Tim Cook in a press release. “Rare earth materials are essential for making advanced technology, and this partnership will help strengthen the supply of these vital materials here in the United States.”

Creating jobs and strengthening national security

This collaboration is poised to create dozens of new jobs in advanced manufacturing, research and development, and rare earth recycling. As the US government continues its efforts to curb reliance on foreign sources for critical materials, including rare earths, the Apple-MP Materials deal represents a significant step forward in fortifying national security and economic resilience.

MP Materials’ stock surged 20 per cent following the announcement, highlighting investor optimism about the long-term growth potential of the rare earth sector. The company, which operates the Mountain Pass mine in California, has already seen its stock price nearly quadruple in value since the beginning of the year, reflecting growing demand for domestic rare earth production. Apple’s investment in the rare earth industry is also part of a broader $500 billion initiative aimed at bolstering US manufacturing capabilities over the next four years, including plans for new factories and technological advancements in sectors like artificial intelligence (AI).

The partnership between Apple and MP Materials is expected to have a far-reaching impact, not only strengthening the US supply chain for rare earths but also driving forward innovation in sustainable recycling technologies and manufacturing processes. As global demand for rare earth materials continues to rise, this collaboration aims to position the United States as a leader in the production of critical materials necessary for the technologies of tomorrow.