TSMC is exploring factory equipment with fewer rare-earth components to protect against Chinese export restrictions that could disrupt advanced chip production.
According to Reuters, three industry executives said the foundry has surveyed suppliers about rare-earth-free motors for factory automation. For those not in the know, rare-earth magnets drive moving parts in fab machinery, creating a potential supply bottleneck for smartphone, data centre and defence chips.
Discussions remain preliminary, with no broad rollout of replacement equipment. TSMC did not immediately respond to Reuters’ request for comment.
Spending billions on advanced manufacturing is considerably less reassuring when a component inside the machinery leaves production exposed to another government’s licensing decisions.
China introduced rare-earth export controls in April and October 2025. A European Parliament briefing says the second package was suspended until 10 November 2026, leaving the industry with another deadline to plan for. Replacing rare-earth magnets requires engineering work and qualification, though alternatives are already being developed for demanding applications.
Earlier this month, motion-control specialist Moog outlined its work testing and qualifying Niron Magnetics’ iron nitride permanent magnets in electromechanical actuators.
The companies are targeting defence applications, aiming to reduce dependence on foreign-controlled mineral supplies. Their announcement illustrates the wider search for alternatives, without indicating any involvement in TSMC’s plans. Niron has been producing magnets for customer qualification since 2025. Moog’s October announcement put commercial production within the following 18 months.
