The electric vehicle (EV) market continues its upward trajectory, but the pace of growth in Europe and the US has slowed considerably in the first half of 2024.
A critical strategy to revitalise this momentum lies in the development of more affordable EV models, and while much attention has been focused on reducing battery costs, optimising other components, such as electric motors, presents another significant avenue for cost reduction.
According to IDTechEx’s latest report, 'Electric Motors for Electric Vehicles 2025-2035: Technologies, Materials, Markets, and Forecasts, by 2035, over 160 million electric motors will be needed for the EV market, with around 30% of the automotive sector expected to shift to rare earth-free technologies.
Enhancing Motor Efficiency To Reduce Battery Costs
One of the key ways electric motors can reduce vehicle costs is by improving efficiency. The more efficient a motor, the greater the range it can achieve from the same battery capacity. For instance, improving motor efficiency from 93% to 96% could reduce the energy demand for a typical 75kWh EV by around 2.9%, translating to a significant cost reduction in battery price—potentially around $200 per vehicle. Given that battery costs currently hover around $100/kWh, even small improvements in motor efficiency can have a noticeable impact on overall vehicle costs.
Permanent magnet (PM) motors dominate the EV landscape, accounting for 85% of the market share in battery electric and plug-in hybrid vehicles. However, these motors rely on rare earth materials, which are not only expensive but also subject to significant price volatility. Since 2010, the price of neodymium, a key component, has fluctuated dramatically, at times reaching up to five times its minimum price.
Exploring Rare Earth-Free Alternatives
In response to the volatility of rare earth materials, manufacturers are exploring alternatives like wound rotor synchronous motors (WRSM) and rare earth-free magnets. WRSM motors eliminate the need for costly permanent magnets by using copper windings, though they are more complex and expensive to manufacture. Another option is rare earth-free magnets such as ferrites or AlNiCo. These magnets offer lower costs but often require larger motors to compensate for their lower performance.
Ultimately, alternatives to rare earth permanent magnet motors will become more viable if rare earth prices remain high or if environmental and supply chain concerns drive manufacturers toward more sustainable options.
Supply Chain Security
Looking toward the future, axial flux motors, which offer very high power and torque density, could play a crucial role in reducing EV costs. These motors utilise less material per kilowatt of power, potentially leading to further cost reductions. However, despite their potential, axial flux motors have yet to reach the scale required for widespread use in the automotive market.
As the industry seeks to stabilise supply chains and mitigate the risks of rare earth material shortages, IDTechEx predicts that rare earth-free technologies will account for 30% of the automotive motor market by 2035. This shift will likely be driven not only by cost considerations but also by a growing focus on environmental sustainability and the need for more secure supply chains.
As the EV market continues to evolve, innovations in motor technology will be crucial to lowering vehicle costs and meeting growing global demand. The ongoing development of more efficient motors, rare earth-free alternatives, and potential breakthroughs in axial flux technology will help manufacturers remain competitive while driving down the overall cost of EVs. The future of electric vehicles will be shaped by how quickly and effectively these innovations can be brought to market, providing consumers with more affordable and sustainable options.
NB: Photo is representational.
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