Routes for EV Motors to Reduce Their Chinese Rare Earth Reliance

 

Trade restrictions put in place by China in 2025 have made securing rare earth materials more challenging for the rest of the world. Rare earths are used in many applications, but one that uses them in great quantities is electric vehicle (EV) motors. IDTechEx found that 87% of the EV market worldwide used electric motors containing rare earths in 2024. Each motor would have in the range of 1-3kg of rare earth magnets. With these new restrictions, the narrative in the motor industry has once again circled back to rare earth reduction. IDTechEx's latest report on Electric Motors for Electric Vehicles 2026-2036 takes a deep dive into alternative technologies, materials, and approaches. This article aims to cover some of the main routes to reduction of rare earths and reducing reliance on China.

 

According to IDTechEx, China accounts for 69% of rare earth element mining in 2025, with this share increasing towards 90% for downstream separation, metallization, and magnet production. In 2025, China introduced a new licensing system for rare earth exports. Whilst not explicitly preventing their use globally, it requires exporters to obtain specific licenses to ship materials abroad, which has made securing these materials more complex.

 

 

 

 

The vast majority of EV motors are using neodymium magnets which also contain heavy rare earths like dysprosium and terbium in order to prevent demagnetisation at elevated temperatures. Dysprosium and terbium specifically are some of the rare earths that are under direct restriction.

 

Companies including Maruti Suzuki, Lucid Motors, Ford, Suzuki Motor, Bajaj Auto, and Ather Energy all had to delay, halt, or reduce production in 2025 due to difficulty in securing rare earth materials. From July 2025, export licenses started to be granted somewhat easing the tension. However, this event, like many restrictions and supply chain disruptions historically has brought the conversation back to reducing reliance on China for these materials.

 

Other regions are investing in the mining, production, and recycling of rare earth materials, but these are all longer-term strategies and will take a significant amount of time to become operational. Plus, much more investment would be needed to completely domesticate material supply.

 

 

 

For electric motor manufacturers and EV OEMs, there are existing and emerging technologies that can reduce or eliminate rare earths.

 

An iterative method to rare earth reduction is improving motor power density and efficiency through design optimisation. Higher speed motors for example can be smaller for the same power output (albeit with other trade offs), but will reduce overall material consumption. In general the market has moved towards higher power density and more integrated drive units as the market has scaled, but these reductions in rare earths are on the scale of tens of % rather than halving or more.

 

Japanese automakers such as Toyota, Nissan, and Honda have all historically made announcements about reducing the heavy rare earth content of their motor magnets. This is largely through material engineering, such as refining the grain structure or tightly controlling impurities.

 

Since the heavy rare earths are primarily to prevent demagnetization at elevated temperatures, having a more effective thermal management system can also reduce the need for heavy rare earths. Manufacturers have increasingly adopted direct oil cooling for various parts of the motor, but the thermal system/design would have to be carefully considered, as demagnetisation of the rare earth magnets is not reversible.

 

 

 

Another alternative that is already commercially viable is the externally excited synchronous motor (EESM). This has seen adoption from Renault, BMW, and Nissan in various EV models. This design uses copper electromagnets on the rotor, rather than rare earth permanent magnets. It does add some complexity in the need to power the rotor windings, and is typically less efficient on the WLTP cycle. There is also a trade off in manufacturing prices. When rare earth prices are high, the EESM becomes very viable, when rare earth prices are low, the EESM becomes a less appealing option, hence why many have not switched to this approach in the past.

 

Other permanent magnet free designs such as synchronous reluctance, switched reluctance, and induction motors all have their own pros and cons, but will struggle to match the performance and efficiency of rare earth motors.

 

 

Ferrite magnets are an alternative magnet type that are widely available and not constrained to China. However, their magnetic performance is much poorer than rare earth magnets. Therefore, a much larger amount of magnetic material is required, which leads to challenges in constructing the rotor and results in a much larger motor for the same performance. However, a cleverly designed ferrite motor targeted at the lower end of the performance range could be a viable solution for some vehicle segments.

 

 

In addition to existing ferrite magnets, there are companies working on improved magnetic materials such as Niron Magnetics and Proterial. Whilst these may not yet match the performance of rare earth magnets across all performance metrics, if they can bridge the gap between typical ferrite magnets and rare earth magnets, they could be sufficient for several motor applications at a much lower cost, with reduced supply chain concerns.

 

As discussed, there are several options for avoiding or reducing rare earth content for EV motors. Each has its own pros, cons, and state of commercial viability. IDTechEx's report on Electric Motors for Electric Vehicles 2026-2036 looks at these approaches, the key technologies, players, market status, and forecasts out adoption of different technologies through to 2036. It finds that nearly 30% of the EV market will be using rare earth free motors by 2036, although this percentage is dragged down by the dominance of China in the EV and rare earth market, with Europe and the US taking a much bigger portion of rare earth free alternatives. For more information on this report, including downloadable sample pages, please visit www.IDTechEx.com/Motors.

 

The IDTechEx report "Rare Earth Magnets 2026-2036: Technologies, Supply, Markets, Forecasts" also offers comprehensive analysis and benchmarking of rare earth magnet technologies - see www.IDTechEx.com/REM for more.

 

 

IDTechEx offers a wide portfolio of comprehensive, unbiased studies researched at a global level and compiled by technical domain experts. Visit www.IDTechEx.com for more details.