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- 13 Jun 2025
- ICICIdirect Research
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INDIAN E2W COMPANIES HAVE BEGUN TESTING LIGHT RARE EARTH MAGNETS IN THEIR EXISTING MODELS
News: As per media sources, leading Indian E2W companies have begun testing light rare earth magnets in their existing models as a direct response to China’s recent export restrictions on medium and heavy rare earth magnets, which are vital for EV motors. With inventories of these critical components projected to last only until mid-July, manufacturers hope to roll out vehicles powered by light rare earth magnets within the next three to four months, aiming to avert production halts and maintain momentum in India’s rapidly growing EV sector.
View: Industry experts and stakeholders caution that while the switch to light rare earth magnets may provide short-term relief, it poses significant engineering and performance challenges. Light rare earth magnets are less powerful, potentially requiring design changes and risking reduced vehicle efficiency. The crisis has exposed India’s heavy reliance on Chinese imports, prompting calls for government intervention, supply chain diversification, and accelerated development of alternative technologies such as magnet-free motors.
Impact: Neutral