USA Rare Earth (Nasdaq: USAR) plans to invest more than €175 million ($204 million) in France to expand rare-earth metal, alloy and magnet production capacity, strengthening Western efforts to build supply chains independent of China.
The company said Monday the investment would build on its earlier agreement to acquire a stake in French rare-earth processor Carester and could create more than 300 jobs.
USA Rare Earth has already invested in a rare-earth metal and alloy production facility in France and earlier this year disclosed plans to evaluate a magnet manufacturing plant in the country.
“At USA Rare Earth, we are committed to creating resilient, regional operations as we build out the mine-to-magnet value chain,” CEO Barbara Humpton said at a summit in Paris. “France is an attractive location, with a strong combination of industrial infrastructure, a re-emerging rare earth processing cluster, skilled workforce, and the policy support to rebuild critical minerals capability.”
The company said the proposed expansion aligns with agreements between the company and the US Commerce Department as Washington prioritizes domestic and allied rare-earth supply chains.
France could provide financial support and debt guarantees for the project, USA Rare Earth said.
The investment also reflects a broader push across the US and Europe to secure supplies of rare earths, which are essential for electric vehicles, renewable energy technologies, electronics and defence applications. China remains the dominant global producer and processor of the critical minerals, prompting Western governments to accelerate efforts to diversify supply.
Legal issues
The expansion comes as USA Rare Earth faces legal challenges from rival MP Materials (NYSE: MP). Last week, MP sued the company, alleging it obtained proprietary magnet-making technology through a former employee. According to the complaint, the ex-employee shared “grain boundary diffusion” formulations with USA Rare Earth, which later disclosed the information to a third-party technology company.
USA Rare Earth denied the allegations, saying MP’s lawsuit “has misrepresented our company, our culture, and our people,” and that it would defend itself against the claims and respond “appropriately.”
