Honda invests in rare-earth-free magnet maker for EVs

Honda's funding of Minnesota plant targets EV cost barriers by cutting rare earth dependency

Honda Motor Co. invested in Niron Magnetics through its global open innovation program Honda Xcelerator Ventures. The U.S. company operates a 287,000-square-foot manufacturing plant in Sartell, Minnesota, scheduled for operational status in 2027. This facility has potential annual capacity for 1,500 tons of rare-earth-free permanent magnets and employs 175 workers. Niron supplies rare-earth-free neodymium magnets to Honda for full-size trucks and SUVs under a multi-year agreement, with first deliveries beginning in July 2025.

Niron's iron nitride magnets exceed rare-earth-based alternatives by up to 50% in performance and offer improved thermal stability across wider temperature ranges. The company sources raw materials domestically and spun out of U.S. Department of Energy research in 2013. This addresses China's dominance in rare earths—accounting for 60% of global mined production and 91% of refined output in 2024 (IEA data)—by creating a domestic supply chain for critical EV components.

This reduces Honda's reliance on scarce, geographically concentrated rare earths, lowering long-term EV cost barriers. By enabling domestic production of high-performance magnets, it helps scale affordable EVs without price volatility from global supply chains. The plant's 2027 operational timeline and conditional $150 million U.S. Department of Defense loan commitment signal near-term progress toward reducing critical mineral dependencies.

*Note: The plant construction started 'recently' per the September 2026 article but is scheduled for 2027 operation. The DoD loan is conditional, and Niron's performance claims are company statements.*

Source: Manufacturing Dive