TSMC reportedly seeks chipmaking equipment without rare-earth magnets
TSMC is reported to be asking suppliers for non-rare-earth motors to mitigate risks from Chinese export controls.
According to a Reuters report cited by Tom's Hardware on October 22, 2026, TSMC, the world's largest contract chip manufacturer, has begun approaching its equipment suppliers to explore whether they can provide factory automation equipment equipped with motors that do not require rare-earth materials. This move aims to reduce dependence on China-dominated critical material supplies and avoid disruptions to fab operations caused by Chinese export controls.
TSMC's advanced process fabs rely heavily on industrial machinery using electric motors with powerful permanent magnets made from rare-earth elements such as neodymium and dysprosium. Data from the U.S. Geological Survey and the International Energy Agency indicates that China controls approximately 95% of the global supply of finished permanent magnets. With China tightening export controls on medium and heavy rare earths since 2025, TSMC faces potential shortages of specialized motor components for maintenance, repair, or expansion of production equipment.
Several technological approaches allow motors to avoid rare-earth magnets, such as conventional induction motors and switched-reluctance motors. However, these technologies typically involve trade-offs in efficiency, size, power density, and precision. The report is based on 'people familiar with the matter,' and TSMC has not publicly confirmed this specific procurement exploration.