Bajaj Auto restarts Chetak deliveries; secures supply of rare earth magnets

Bajaj Auto resumes deliveries of its Chetak electric scooter after overcoming global supply disruptions, securing sufficient rare earth magnets for the upcoming festive season

Two-wheeler major Bajaj Auto on Friday announced that it has resumed deliveries of its electric scooter, Chetak, across all dealerships, after navigating supply disruptions caused by a global shortage of rare earth magnet. 

 

Bajaj Auto has secured sufficient supply of rare earth magnets and other key materials to ensure availability during the upcoming festival season, it has said in a stock exchange notification.

 

Bajaj Auto faced significant production challenges, with the Chetak electric scooters’ output reducing by up to 50 per cent in July.

 

Rakesh Sharma, executive director of Bajaj Auto, had earlier noted that production impairment began in late June, with a 50 per cent decline recorded in July, while August is expected to remain at 50–60 per cent of the planned output.

 

 

Despite constraints, Bajaj Auto has managed to restore production ahead of schedule. The shipments resumed on August 20, allowing the company to meet the growing demand for Chetak ahead of the festival season, the company has said.

 

Eric Vas, president of the Urbanite Business Unit, said: “The demand for Chetak remains robust, supplies have normalised and deliveries against bookings have commenced. We are scaling up production to meet the rising demand while maintaining our quality standards.”

 

The shortage of heavy rare earth magnets intensified in April 2025, when China restricted exports of seven key elements in response to the tariffs imposed by the United States, causing a 75 per cent drop in global magnet exports. The shortage had hit India’s EV and electronics sectors, forcing companies to explore alternative sourcing and magnet-free motor designs.

 

According to the data from Federation of Automobile Dealers Association (FADA), Bajaj’s electric vehicle sales in January stood at 21,310 units, which nearly doubled from 10,891 units sold in the same month last year, and March peaked at 34,907 units, registering a 92 per cent year-on-year increase.

 

However, production faced volatility from April onwards, dropping 45 per cent month-on-month in April to 19,001 units. Bajaj’s sales recovered moderately in May and June, reaching over 23,000 units in June, but July saw another decline to 19,683 units, reflecting the ongoing supply pressures.

 

Other electric vehicle makers in India have also been affected by the global magnet squeeze. Hero MotoCorp reported that it has secured sufficient supplies for both ICE and EV models for Q2. TVS is managing production through locally sourced larger magnets. Newer entrants, including Ather, continue to face supply gaps affecting order fulfilment.

 

The Indian government is accelerating initiatives to develop a domestic rare earth magnet industry, aiming to reduce reliance on imports and safeguard the country’s EV production capabilities in the long term.