India revs up alternate EV motor tests as China curbs rare earths exports

Unlike regular EV motors, the one being tested by Sterling Gtake E-Mobility does not use rare-earth magnets - a technology that, while not new, is uncommon and could be transformative for the world's No. 3 car market that has been hit harder than most by China's export curbs on the critical minerals.

"We want to be in commercial production as soon as possible," Sterling Managing Director Jaideep Wadhwa said.

Seven Indian automakers are reviewing the motors, and if cleared, production could begin within a year, well ahead of an initial 2029 target, he added. Sterling sped up the timeline after China announced the curbs in April in response to U.S. tariffs.

While China has since resumed some rare earth shipments to the U.S. and Europe, India remains effectively cut off due to political tensions with Beijing. Indian companies have yet to see a single import application approved.

Prime Minister Narendra Modi and Chinese President Xi Jinping have discussed ways to improve trade, and Beijing has agreed to lift curbs on magnet exports but has not given a timeline.

Against this backdrop, Sterling and several other firms are expediting work on alternate technologies that eliminate magnets or use ferrite or "light" rare earths, materials for which there is no dependence on China.

China controls more than 90% of the world's rare-earths processing capacity, giving it diplomatic clout and dominance over the supply chain, as the global pivot to EVs intensifies demand for the group of 17 elements vital to consumer electronics, EV batteries, and motor magnets.

India has the world's fifth-largest rare earth reserves, but lacks the ability to process them into magnets.

To address this, the government plans to offer incentives for mining and processing, while also seeking to collaborate with Japanese and South Korean companies to produce magnets.

CUT RARE EARTH DEPENDENCE

Car makers like BMW BMWG.DE and Nissan 7201.T are already building EV motors that do not rely on rare earths.

However, the technology is yet to see widespread adoption as matching the compact size, light weight and performance of magnet-based motors remains a challenge. Rigorous testing requirements have further deterred many automakers.

But that appears to be changing amid concerns about China using rare earths as a political tool. In 2010, Beijing briefly stopped shipments to Japan after a diplomatic dispute.

"This could happen again in five years" cautioned Vivek Vikram Singh, CEO of Indian parts supplier Sona Comstar SONB.NS, referring to China's export curbs.

While plans to mine and process rare earths would take years to develop, Singh said India "should not stop working on it".

Sona, the largest importer of rare earth magnets in India's auto sector, has plans to make magnets domestically and is also developing motors without heavy rare earths from China.

In Faridabad, Sterling has hooked up one motor to the back wheel of a stationary motorcycle in its lab and mounted another on a dynamometer to measure torque and power output, while various screens capture performance data.

These high-density reluctance motors use tightly wound metal coils, instead of rare-earth magnets, to generate magnetic force and power.

The technology belongs to Britain's Advanced Electric Machines, which in June signed a licensing deal with Sterling, enabling the Indian company to build the motors domestically.

James Widmer, CEO of Advanced Electric Machines, said customers were pushing for quick solutions.

"What can you do now? That is what customers are asking."

'SCRAMBLING FOR LOCAL SOLUTIONS'

In Japan, scientist Masato Sagawa, who invented a magnet using rare earth element neodymium in the 1980s, is advocating for rare-earth free alternatives, saying they would be cheaper.

In India, start-up Chara Technologies has spent five years refining its magnet-free motor technology to match and exceed the performance of existing motors, CEO Bhaktha Keshavachar said.

While its motors are about 10%-15% heavier, the company is seeing demand from customers in India and Europe, he said.

Chara, which has built motors for two and three-wheelers, will soon start production for small cars under a metric tonne.

U.S.-based Conifer is returning to long-used ferrite magnets in motors which Indian founder Ankit Somani says can deliver 10%-30% better range than incumbent designs with some innovation, and are much cheaper.

The company's Pune factory in western India is producing hundreds of motors and will hit its annual capacity of 70,000 units within two quarters, Somani said.

"Everybody's scrambling for local solutions," he added.