Elon Musk has unexpectedly pulled the emergency brake. His ambitious plan to roll out an army of humanoid Optimus robots has been hit hard—before even a single unit left the factory. The reason? China just shut off the supply of critical materials.
🔹 China vs. Tesla: 1–0
Earlier this month, the Chinese government introduced new restrictions on the export of seven rare earth elements, without which Tesla’s robots simply can’t function. These "magical" materials are essential for creating magnets—basically the heart of the Optimus robot’s movement system.
🔹 Elon: “It’s not a military bot!”
During Tesla’s earnings call, Musk confirmed the project is frozen: “We’re working with China. Hopefully, we’ll get a license to use the rare earth magnets.” He stressed that the usage is purely civilian, but Beijing wants guarantees—and so far, no green light.
🔹 Trade War Hits the Tech Sector
The restricted rare earths—terbium, yttrium, dysprosium, gadolinium, lutetium, samarium, and scandium—are crucial in high-tech, from medical lasers to fighter jets. Tesla planned to use them to take robotics to the next level.
🔹 U.S. vs. China: A Massive Gap
While China dominates the rare earth refinement process, the U.S. is lagging behind. Mountain Pass in California is the only major domestic mine, but the actual refining still happens in Asia. In 2023, China produced over 58,000 tons of refined materials; the U.S. managed barely 1,100.
🔹 A Magnetic Crisis
Without these minerals, humanoid robot production grinds to a halt. Terbium powers heat-resistant magnets, yttrium fuels medical lasers and superconductors, dysprosium is used in advanced motors, and samarium forms the core of ultra-powerful magnets.
🔹 Bottom Line? China’s Pulling the Strings
Trump’s tariffs launched a trade war. Now China is firing back—strategically cutting access to what Western tech giants desperately need. And Tesla? For now, it waits, hoping to get the green light to restart.
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