BEIJING/LONDON • Nine years ago, Ian Higgins' company in the north-west of England was jolted by bad news from Volkswagen. Prices for rare earths were rising, so Europe's largest carmaker warned it was planning to discontinue use of all rare earth alloys in its magnets.

Mr Higgins braced himself for other clients to take a similar step, threatening his metal alloy maker Less Common Metals if the car industry moved away from the technology. Instead, to his relief, the scare died down.