Highlights

• Solvay CEO Philippe Kehren stated that the company is more likely to build its next rare earth processing plant in the U.S. rather than France due to stronger government support and faster policy execution under the Inflation Reduction Act.
• The U.S. has adopted an interventionist industrial policy featuring defense-backed purchase guarantees, tax incentives, and shortened permitting cycles that de-risk capital.
• Europe is facing regulatory delays and inconsistent subsidy frameworks.
• North America's approach of 'pay first, regulate later' has generated supply-chain momentum, with projects advancing from planning to production.
• Sustained success in North America hinges on execution and continued political support.

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The latest remarks by Solvay CEO Philippe Kehren (opens in a new tab) to Reuters (opens in a new tab) reveal a growing divergence between North America and Europe in rare earth investment speed. The Belgian chemical giant—one of the few Western players with actual separation technology—acknowledged it is now more likely to build its next processing plant in the United States rather than France. The reason? Incentives, not sentiment.

Europe talks of “strategic autonomy,” but the U.S. writes checks. Under the Inflation Reduction Act, Defense Production Act, and Trump-era national security programs, projects like MP Materials’ California-to-Texas mine-to-magnet chain or EVAC’s new South Carolina magnet facility are moving from PowerPoint to production. In contrast, Solvay’s proposed €50–100 million expansion in France remains on hold pending policy clarity.

When Incentives Trump Caution

Kehren’s comment—“We see more support coming from North America to be perfectly clear”—cuts to the heart of the issue. The U.S. has adopted an unapologetically interventionist industrial policy. Defense-backed purchase guarantees, state tax incentives, and strategic loans have shortened permitting cycles and de-risked capital.  In fact, according to Rare Earth Exchanges (REEx), the U.S. government is not doing enough to support critical mineral and rare earth element supply chain resilience.

In Europe, by comparison, investors face what one Brussels insider calls “a marathon of memos.” Environmental review regimes and inconsistent subsidy rules slow progress. Even France’s La Rochelle plant—once among the largest REE refineries outside China—still produces only hundreds of tonnes annually, a rounding error against China’s 90 percent market share.

The Pulse of Progress

From a supply-chain analysis standpoint, Solvay’s U.S. lean is logical. North America offers ready customers (automotive, defense, wind), growing feedstock streams from Mountain Pass and Energy Fuels, and a swelling pool of venture-backed recyclers. The region’s policy velocity now exceeds its geological luck—a rare reversal in mining history.

Yet caution remains warranted. Most U.S. projects are still ramping and depend on sustained government confidence. The “faster” ecosystem could stall if politics change or if project costs overrun optimistic forecasts.

Closing Thought: The Race Is on

REEx observes that the U.S. supply chain is moving, while Europe is still debating moving. Washington’s transactional realism—pay first, regulate later—has clearly spurred momentum. Whether this translates into lasting independence from China’s processing monopoly will depend on execution, not enthusiasm.

But today, the race’s lead has shifted westward across the Atlantic.

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