General Dynamics Gear Could Be Hampered by China’s 98% Rare Earth Magnet Control
Pentagon ordered 30,000 one-way attack drones with plans to expand production to over 300,000 by early 2028, all reliant on rare earth magnets. With China supplying 98% of these magnets and a 2027 U.S. ban on Chinese-origin rare earths looming, General Dynamics faces potential supply bottlenecks in its weapons platforms.
1. U.S. Drone Expansion
The Pentagon approved the largest drone procurement in U.S. history, ordering 30,000 one-way attack drones and planning to scale to over 300,000 units by early 2028, embedding unmanned systems at the core of future defense posture.
2. Rare Earth Magnet Reliance
Each drone motor and thousands of components across 1,900 weapons systems depend on heavy rare earth magnets, over 98% of which China now produces, posing a strategic risk to uninterrupted defense manufacturing.
3. Impact on General Dynamics
General Dynamics platforms, including guidance systems and sensors, incorporate these magnets and could face production delays or cost surges unless non-Chinese supply chains are certified before the 2027 compliance deadline.
4. Domestic Supply Initiatives
With a looming ban on Chinese-origin rare earths for U.S. defense in 2027, the Department of Defense has invested in domestic suppliers like MP Materials and REalloys to build a fully non-Chinese heavy rare earth supply chain.