Apple Invests $500 Million in US Rare Earth Magnet Producer MP Materials, Boosts American Manufacturing

Apple has invested $500 million in US rare earth magnet producer MP Materials, strengthening the domestic supply of essential materials for advanced technology. The deal sends a message to President Donald Trump, who has pressured Apple to build more in the US. MP Materials' stock price soared over 25% on Tuesday, and the company will provide extensive training at its new Texas factory to build a specialized workforce for magnet manufacturing.

Apple Inc. has announced a significant investment in MP Materials, a U.S.-based producer of rare earth magnets, amounting to $500 million. This strategic move underscores Apple's commitment to strengthen its domestic supply chain for essential materials, a key priority for the Trump administration. The deal, which includes plans for recycling facilities and increased production capacity, aims to reduce the U.S.'s reliance on foreign sources, particularly China, for rare earth materials.

The agreement, signed on Tuesday, involves Apple pre-paying MP Materials $200 million for rare earth magnets slated to begin production in 2027. These magnets will be manufactured at MP's facility in Fort Worth, Texas, using recycled materials sourced from MP's Mountain Pass, California, mining complex. The deal is part of Apple's broader $500 billion investment commitment to the United States, announced earlier this year [1].

The move is expected to create dozens of new manufacturing and R&D roles, contributing to the U.S. economy and bolstering domestic capabilities. Apple CEO Tim Cook stated, "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" [2].

MP Materials' stock price surged over 25% on Tuesday, reflecting investor confidence in the deal and the company's potential to benefit from increased demand for rare earth magnets. The agreement also includes a collaboration on advanced recycling technology, aiming to turn end-of-life magnets into processed material that meets Apple's performance and design standards [3].

This investment comes amidst ongoing efforts by the U.S. government to bolster domestic rare earth supply chains. Last week, the Department of Defense became the largest shareholder in MP Materials, investing $400 million to support the company's efforts to build out an end-to-end U.S. rare earth magnet supply chain [4].

The deal sends a clear message to President Trump, who has been pressing Apple to increase its manufacturing in the U.S. Although many analysts have noted that making the iPhone in the U.S. is challenging due to labor costs and the existing supply chain, this investment signals Apple's alignment with U.S. industrial policy [1].

In summary, Apple's $500 million investment in MP Materials is a strategic move aimed at strengthening the U.S. supply of rare earth magnets, reducing dependence on foreign sources, and creating jobs in the domestic manufacturing sector.

References:
[1] https://asia.nikkei.com/Spotlight/Supply-Chain/Apple-inks-500m-deal-with-MP-Materials-for-rare-earth-magnets
[2] https://www.nbcmiami.com/news/business/money-report/apple-makes-500-million-deal-with-miner-mp-materials-for-rare-earths-magnets/3658160/
[3] https://www.benzinga.com/trading-ideas/movers/25/07/46414833/mp-materials-stock-surges-on-500-million-partnership-with-apple
[4] https://www.foxbusiness.com/politics/apple-backs-trump-rare-earth-minerals-push-invests-500m-us-mine