How India’s electric car makers are racing to ditch rare earth elements amid China’s stranglehold

While Simple Energy has re-engineered the magnet-based motor to eliminate bound rare earth elements, Chara Technologies is taking a completely different route – developing motors that don’t use magnets at all.

The redesigned Simple Energy engines have already hit the market with the company reporting record sales in October. However, the commercial deployment of Chara Technology motors in EVs has not yet begun and is likely to begin from next quarter.

Early move for Simple Energy

Simple Energy approved its rare-earth-free heavy-duty engine in July this year, just two months after China imposed export restrictions on select rare earth materials. The company claims its internally developed engine is free of seven heavy rare earth elements banned by Beijing in April.

The company said it had replaced heavy rare earth magnets with “improved compounds” (alternative metals) and coupled that with “special algorithms” (internal control software). The most common electric motors used in modern electric vehicles are the permanent magnet synchronous motor (PMSM) which uses permanent magnets made of rare earths such as neodymium, praseodymium, dysprosium and terbium.

The company’s patented in-house technology enables the magnetization of these alternative materials – iron, neodymium, boron, praseodymium and holmium – through extensive testing and formulation to match the performance and efficiency of traditional heavy rare earth element-based systems, Shresth Mishra, co-founder of Simple Energy, told The Indian Express.

“The engine is also powered by proprietary algorithms that intelligently manage heat, magnetic fields and torque delivery in real time, ensuring consistent performance and reliability across diverse driving conditions,” he explained.

While neodymium and praseodymium are light rare earth elements, they are not part of the 12 elements whose import Beijing has restricted so far. Holmium is a heavy rare earth element and its import was not initially restricted. However, he was later added to that list in October.

Mishra said their engine matches the efficiency of conventional rare earth engines in terms of specifications and performance. “The only difference is close to 0.5 percent. So, in terms of magnetic field and performance, we are achieving the same results,” he said.

He added that the company had been working on developing the technology long before the Chinese restrictions came into effect.

He added: “We had to work in such a way that we removed those items that were on the list of restrictions and replaced them with items that were not restricted.”

Mishra claims that all its current compounds are completely free of heavy rare earth elements. The company also recorded its highest ever monthly sales in October, at 1,050 units, an increase of 215 per cent year-on-year, and expanded its retail presence to around 250 stores across India.

Chara magnet-free motor

Meanwhile, Chara Technology has developed a magnet-free synchronous reluctance motor (SynRM) specifically designed for electric vehicles. While SynRM motors are popular in the industrial sector, their application in electric vehicles has been limited due to challenges in reconciling the small size and efficiency of magnet-based motors.

The company claims to have developed a version of the SynRM drive over the past six years that is specifically designed for electric vehicles.

“Those used in industrial applications typically operate at a low, constant speed. But our motors reach the speed required for electric vehicles, and operate at variable speeds: from zero to maximum,” Bhaktha Keshavachar, co-founder and CEO of Chara Technologies, told The Indian Express.

Keshavachar said the Chara motor delivers similar torque and power to rare earth motors, with only a slight increase in size – about 16 per cent larger, which means an additional 1.5 kg in a two-wheeler and 3 kg in a three-wheeler.

Chara currently supplies its engines to customers in the agricultural and industrial equipment sectors. It expects the deployment of electric vehicles to begin by the end of next quarter.

In the electric car sector, its engine has so far only entered the three-wheeled vehicle category.

“All the materials used in building the motor come from India. Everything from the electromagnetic materials, hardware, software and manufacturing has been designed from the ground up. Our systems are completely free of Chinese magnets,” Keshavachar said.

Strategic importance

These domestic efforts come at a time when China — which controls more than 90 percent of rare earth processing globally — has been working to tighten export regulations on these materials as a weapon in its trade war with the United States. In April, China imposed restrictions on seven rare earth elements – samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium. This was followed in October by five more magnets – holmium, erbium, thulium, europium, and ytterbium – as well as related magnets and materials.

While the direct impact of these restrictions is limited in India, they have intensified supply chain challenges for the automotive industry, especially the EV and electronics sector. Several Indian EV manufacturers, including Ola Electric and TVS Motor, are also said to be working on rare earth technologies. In October, Ola Electric also said its ferrite motor had received government approval.

Last week, China partially eased some restrictions on its exports of important minerals and rare earth minerals to the United States. However, it is not yet clear whether this means a complete rollback of controls on rare earth exports that China imposed in April. Earlier this month, the United States alleged that China agreed to issue general licenses for exports of rare earth elements, gallium, germanium, antimony, and graphite for the benefit of US end users and their suppliers.

According to the Ministry of Mines, India imported 2,270 tonnes of rare earth elements in 2023-24, up 23 per cent from 1,848 tonnes in 2019-2020. Imports from China accounted for 65 percent.