Neo strengthens electric vehicle supply chain with opening of magnet manufacturing facility

Neo Performance Materials Inc. announces the grand opening of its new, state-of-the-art permanent magnet manufacturing facility in Estonia. The inauguration marks a significant milestone in establishing a resilient, independent European footprint to supply critical rare earth magnets essential to electric vehicles (EVs), wind energy, robotics, and the broader energy transition.

The grand opening ceremony was attended by more than 270 guests, including senior leadership from the global automotive, renewable energy, and technology sectors, alongside government officials, media, and investors from across Europe, North America, Australia, and Japan. The event showcased the facility’s advanced capabilities and its strategic importance in the global shift toward electrification and sustainability.

The grand opening was accompanied by an Investor/Analyst Day, which included a tour of Neo’s permanent magnet facility in Narva and the existing rare earth separation facility in Sillamäe. Attendees had the opportunity to view the new Heavy Rare Earth Separation Unit, currently being installed.

Neo’s investment in Estonia extends beyond manufacturing to fostering the next generation of scientific and technical talent. In its commitment to local development, Neo has established key cooperation agreements with Estonia’s leading educational institutions, including:

• University of Tartu’s Youth Academy: Sponsoring the training of Estonia’s top young students for international Olympiads in mathematics, physics, and chemistry.
• Tallinn University of Technology (TalTech): Collaborating on programs for students specializing in rare earths chemistry and the digitalization of manufacturing.
• Robotex: Supporting Estonia’s premier robotics competition to inspire innovation among young engineers.

“Magnets are crucial for Europe’s future. They power electric vehicles, wind turbines, and microelectronics,” says Raffaele Fitto, executive vice president of the European Commission. “Now, Neo’s first facility in Narva will satisfy up to 15% of the EU’s demand for these magnets.”

 “Today marks a historic milestone for Neo and a pivotal moment for the global rare earth industry,” says Rahim Suleman, president and CEO of Neo Performance Materials. “This facility is built on Neo’s three decades of experience in magnetic materials and demonstrates our unwavering commitment to our customers in the electric vehicle and wind energy sectors. We are immensely grateful for the partnership of the Estonian government and the European Commission, whose vision and support have been instrumental in bringing this project to life.”

Completed in 500 days, Neo’s new facility is already producing and shipping qualification sample magnets to meet contract obligations for automotive platforms it has been awarded and for numerous upcoming programs. The European facility has already secured contracts for traction motor magnets – widely regarded as the most technically demanding product category –and has expanded its product offerings to non-traction-motor applications as demand for local supply chains has increased.

On September 19, 2025, Neo announced the extension of its strategic partnership with Robert Bosch GmbH through a multi-year Memorandum of Understanding. This agreement reserves annual magnet production capacity for Bosch, ensuring a stable supply chain and fostering localized production through competition and innovation.

Co-funded by the European Union’s Just Transition Fund, the facility is projected to produce 2,000mt/year of magnets in its first phase (1A), with plans to scale to more than 5,000mt/year in Phase 1B. Through its bonded magnetic materials business, Neo has long been a designer and supplier of rare-earth magnetic products for EV and PHEV traction motors, including pioneering the first commercialized heavy-rare-earth-free magnetic powder used in current EV motors as well as other automotive and industrial applications.  Neo has a broad customer base of some of the largest motor manufacturers in the world.