MP Materials Secures Major Defense Partnership for Texas Magnet Facility

In a significant move to bolster domestic supply chains for critical materials, MP Materials has selected a site in Northlake, Texas, for a new $1.25 billion magnet production campus. Dubbed “Project 10X,” this initiative represents a concrete step in the company’s strategy to build a U.S.-based supply line for rare earth magnets, with the Department of Defense playing a central role.

Strategic Push for Domestic Production

The project is designed to strengthen American industrial capacity. MP Materials estimates the campus will create over 1,500 direct manufacturing and engineering jobs. This effort is part of a broader public-private initiative aimed at reducing reliance on foreign suppliers, specifically for neodymium-iron-boron (NdFeB) magnets, which are vital for modern technologies from electric vehicles to defense systems.

Engineering work and equipment procurement are already underway. The company targets the commencement of operations starting in 2028. Upon completion, the facility is expected to significantly expand MP Materials’ platform, with a stated goal of producing approximately 10,000 tons of NdFeB magnets annually.

Substantial Financial and Government Backing

The venture has garnered considerable support from both federal and state authorities. In a key component of the partnership, the U.S. Department of Defense has committed to purchasing $400 million worth of convertible preferred stock. This investment will make the DoD the company’s largest shareholder, according to MP Materials. The agreement also includes a purchase guarantee for magnets produced at the new plant, covering both defense and commercial customers.

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Further financial incentives are being provided at the state and local level. Texas Governor Greg Abbott announced a grant of $12.9 million from the Texas Enterprise Fund, alongside additional support from the Texas Semiconductor Innovation Fund. Furthermore, Denton County approved a multi-year tax abatement spanning a decade, described as being worth “several million dollars.”

Geopolitical Context and Supply Chain Goals

This development occurs as the United States seeks to secure its supply of rare earth elements, a market historically dominated by China. The U.S. currently imports roughly 10,000 tons of these critical magnets from China each year. The Texas facility is intended to mitigate vulnerabilities to what the company calls “non-market forces” by establishing an integrated domestic supply chain. The raw materials will be sourced from MP Materials’ own Mountain Pass mine in California.

With the planned 2028 operational start date as the next major milestone, the company’s immediate focus will be on execution, construction, and scaling the integrated supply chain.