Tech giant Apple (NASDAQ: AAPL) has struck a $500 million deal with Pentagon-backed MP Materials (NYSE: MP), the United States’ only producer of rare earth elements, as part of a larger effort to secure domestic supply chains for smartphones and electric vehicles.
The investment includes Apple purchasing US-made rare earth magnets from MP Materials’ facility in Fort Worth, Texas. The two companies will co-develop a factory with neodymium magnet production lines specifically tailored for Apple products. The investment is part of Apple’s broader strategy to increase domestic manufacturing, with plans to spend more than $500 billion in the US over the next four years.
Shares of MP Materials surged 22.5%to $59.5 in early trading in New York on Tuesday, the highest intraday price since April 2022. Apple’s stock was up a modest 1%, trading at $211 each.
“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, Apple chief executive officer Tim Cook said in the statement.
Apple said the collaboration will create dozens of new manufacturing and R&D jobs. It also includes a rare earth recycling initiative at MP Materials’ Mountain Pass mine, in California, which will convert recycled feedstock into materials for Apple products.
The companies will co-develop new magnet materials and innovative processing technologies to improve performance.
“This collaboration deepens our vertical integration, strengthens supply chain resilience, and reinforces America’s industrial capacity at a pivotal moment,” MP Materials CEO James Litinsky said in a separate statement Tuesday.
MP Materials landed last week a multi-billion-dollar deal with the US Department of Defense (DoD) to develop a domestic rare earth supply chain. The deal aims to reduce dependence on foreign sources, particularly China.
Earlier this year, after the U.S. imposed 145% tariffs on Chinese imports, Beijing retaliated by halting exports of rare earths magnets, critical for electronics, wind turbines, EVs, and fighter jets. The move disrupted global supply chains: Ford and Suzuki halted some production, Elon Musk cited shortages affecting his robotics operations, and governments scrambled to lock down non-Chinese sources.
Despite global demand, producers outside China, including MP Materials and Australia’s Lynas Rare Earths (ASX: LYC), have struggled with profitability due to weak prices and oversupply.
MP Materials operates the world’s second-largest rare earth mine at Mountain Pass. Mining began in 2017; refining followed in 2023. The company expects to supply magnets to General Motors by year-end and begin shipping from its Texas plant in 2027 to support hundreds of millions of Apple devices.
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Tech giant Apple (NASDAQ: AAPL) has struck a $500 million deal with Pentagon-backed MP Materials (NYSE: MP), the United States’ only producer of rare earth elements, as part of a larger effort to secure domestic supply chains for smartphones and electric vehicles.
The investment includes Apple purchasing US-made rare earth magnets from MP Materials’ facility in Fort Worth, Texas. The two companies will co-develop a factory with neodymium magnet production lines specifically tailored for Apple products. The investment is part of Apple’s broader strategy to increase domestic manufacturing, with plans to spend more than $500 billion in the US over the next four years.
Shares of MP Materials surged 22.5%to $59.5 in early trading in New York on Tuesday, the highest intraday price since April 2022. Apple’s stock was up a modest 1%, trading at $211 each.
“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, Apple chief executive officer Tim Cook said in the statement.
Apple said the collaboration will create dozens of new manufacturing and R&D jobs. It also includes a rare earth recycling initiative at MP Materials’ Mountain Pass mine, in California, which will convert recycled feedstock into materials for Apple products.
The companies will co-develop new magnet materials and innovative processing technologies to improve performance.
“This collaboration deepens our vertical integration, strengthens supply chain resilience, and reinforces America’s industrial capacity at a pivotal moment,” MP Materials CEO James Litinsky said in a separate statement Tuesday.
MP Materials landed last week a multi-billion-dollar deal with the US Department of Defense (DoD) to develop a domestic rare earth supply chain. The deal aims to reduce dependence on foreign sources, particularly China.
Earlier this year, after the U.S. imposed 145% tariffs on Chinese imports, Beijing retaliated by halting exports of rare earths magnets, critical for electronics, wind turbines, EVs, and fighter jets. The move disrupted global supply chains: Ford and Suzuki halted some production, Elon Musk cited shortages affecting his robotics operations, and governments scrambled to lock down non-Chinese sources.
Despite global demand, producers outside China, including MP Materials and Australia’s Lynas Rare Earths (ASX: LYC), have struggled with profitability due to weak prices and oversupply.
MP Materials operates the world’s second-largest rare earth mine at Mountain Pass. Mining began in 2017; refining followed in 2023. The company expects to supply magnets to General Motors by year-end and begin shipping from its Texas plant in 2027 to support hundreds of millions of Apple devices.