America’s Magnet Rebellion: Iron and Air Take Aim at China’s Grip on Electric Motors

America’s Magnet Rebellion: Iron and Air Take Aim at China’s Grip on Electric Motors

A quiet revolution is taking shape in Minnesota, and it doesn’t involve rare metals or far-off mines. Instead, it starts with something almost boring: iron and air.

In an industrial park in Sartell, construction crews are laying the foundation for a factory that could redefine American manufacturing. Minneapolis-based Niron Magnetics plans to build magnets using only iron and nitrogen—the same stuff floating all around us. No rare-earth elements. No overseas dependency. No geopolitical strings attached.

The announcement came alongside a new partnership with global automaker Stellantis, signaling more than just a business deal. It’s part of a rapidly growing movement to remove China from the most fragile parts of industrial supply chains. Today, nearly every electric motor, wind turbine, and smartphone speaker relies on rare-earth magnets—and China dominates that business.

Niron thinks it has a way around that. Its iron nitride technology can deliver performance similar to rare-earth magnets while using materials found in U.S. soil and sky. “We don’t need to bring a mine online,” said CEO Jonathan Rowntree. “This bypasses the need for a new rare-earth supply chain.”

When the Carrot Turns into a Club

China isn’t just the biggest player—it’s practically the only player. It processes about 90 percent of the world’s rare earths and makes 85 percent of permanent magnets. This dominance didn’t happen by accident. Back in the 1990s, U.S. companies shipped manufacturing overseas. In 1995, General Motors even sold its Magnequench division—the pioneer of neodymium magnets—to a Chinese-backed group connected to Deng Xiaoping’s family. That sale haunts the industry to this day.

Now, China is using its control as leverage. A recent directive from its Ministry of Commerce restricts exports of rare-earth magnets and materials, even if they’re only tiny parts inside larger products. China says it’s about national security. Automakers see it as a warning shot. These curbs follow earlier limits placed on gallium and germanium after the U.S. tightened semiconductor export rules.

For car companies, the timing couldn’t be worse. Electric vehicle production already consumes 830,000 tons of rare-earth materials each year, and demand is expected to climb another 15 to 20 percent as EV sales approach 18 million globally. Prices have jumped 25 percent this year alone. Several executives say the situation is bordering on “panic.”

Permanent magnets are woven deep into vehicle systems—traction motors, power steering, pumps, speakers, you name it. A shortage doesn’t just slow production; it can stop entire assembly lines. Stellantis knows the risk. “Collaborating with the Niron Magnetics team allows us to explore the possibilities of this innovative magnet technology,” said Micky Bly, the company’s propulsion engineering chief. His careful wording underscores the reality: the tech shows promise, but it hasn’t been proven at full automotive scale—yet.

The Physics of Freedom

On paper, iron nitride magnets look like a dream. Iron is the fourth most abundant element in Earth’s crust. Nitrogen makes up most of the air. Neither is controlled by foreign powers. Costs could be 30 to 60 percent lower than rare-earth magnets, cutting motor costs by as much as 15 percent—huge savings in an industry where batteries already strain profit margins.

Iron nitride also boasts up to 18 percent higher magnetization than traditional ferrite magnets, making motors smaller and more efficient. When Niron’s Sartell facility opens in early 2027, it plans to produce 1,500 tons annually—about 3 percent of U.S. demand—and create 175 high-tech jobs.

But physics sets limits. Iron nitride struggles at high temperatures because it has lower coercivity, meaning it loses magnetism more easily. Rare-earth magnets—especially those used in aerospace and defense—handle far more heat and stress. Iron nitride tops out around 200–250°C. Some defense magnets withstand 350°C or more. For that reason, experts say iron nitride won’t replace rare-earth magnets in jets or missiles anytime soon. “The technology is promising but fundamentally unproven at scale,” one consultant cautioned.

Beyond Motors: A New Industrial Playbook

The Niron–Stellantis deal is just one piece of a broader strategy: design out fragile materials wherever possible. Industries across the board are rethinking how things are built.

Wind turbine companies blend permanent magnet generators with induction motors. Battery makers are shifting toward lithium-iron-phosphate and sodium-ion chemistries, ditching cobalt and cutting nickel use. Data centers ramp up solid-state drives while recycling magnets from hard drives. Display makers explore quantum dots and perovskites to replace rare-earth phosphors.

The trend is clear: smarter architecture instead of perfect materials. An induction motor might be bulkier, but clever engineering narrows the efficiency gap. Lithium-iron-phosphate batteries may store less energy, but they’re safer and last longer—and smart pack design can make up the difference.

“You rarely need 100 percent substitution,” said one strategist. “Shift 30 to 70 percent of volume to alternatives and save the premium materials for niche or high-performance use.”

The Geopolitical Boomerang

Ironically, China’s export restrictions could accelerate the very diversification it hopes to avoid. When prices spike too high, companies hunt for substitutes. Already, 40 to 45 percent of rare-earth mining happens outside China, with new projects launching in the U.S., Australia, and even Greenland.

In Europe, Norway’s ReTec is scaling hydrogen-based magnet recycling to meet 5 percent of EU demand. Japan and Taiwan are investing in their own nitride magnet programs. The U.S. Department of Energy has invested more than $17.5 million into Niron alone as part of a bigger push to “friendshore” materials.

Some observers see poetic symmetry. “GM’s 1995 sale of Magnequench to China was pivotal—now they’re redeeming it with Niron,” noted one industry historian, referring to GM’s recent investment in the startup.

Evolution, Not Revolution

Investors are intrigued but cautious. Iron nitride magnets will likely roll out in low-risk uses first—audio systems, pumps, auxiliary motors—before tackling traction motors around 2028 or 2029. Auto qualification testing takes years, and failure isn’t an option when lives depend on it.

The permanent magnet market is expected to hit $67 billion by 2033, growing nearly 10 percent a year. If performance improves, iron nitride could grab 5 to 10 percent of EV and wind power applications. Some analysts predict 20 to 30 percent adoption in light-duty EVs by 2030 under aggressive scenarios, with magnet prices dropping up to 40 percent compared to rare-earth versions.

More conservative estimates sit around 5 percent if thermal and coercivity issues persist. In that case, automakers may lean on hybrid solutions like high-efficiency induction motors.

The wildcard? Trade policy. A complete rare-earth export ban from China could ignite a rapid shift—50 percent adoption in new motors by 2030. But if tensions cool, change may slow to a gradual 15 percent transition.

For companies like Stellantis, the value isn’t just raw performance. It’s optionality. It’s insurance. In a world where magnet prices can swing 25 percent in a year, flexibility is power. Niron’s Minnesota factory isn’t just a plant—it’s a hedge against instability.

“This is evolutionary, not revolutionary,” said one automotive analyst. “But when supply chains are weaponized, evolution toward independence is worth a premium.”

Investors should consult financial professionals. Past trends don’t guarantee future results. Diversifying material supply involves risk, long lead times, and the patience to innovate before disruption arrives.