Ola Electric, one of India’s leading electric vehicle manufacturers, has announced plans to introduce rare-earth-free motors in its scooters starting from the October–December quarter of this financial year. The move comes in response to global supply constraints following China’s recent export controls on rare earth magnets.
Founder and Managing Director Bhavish Aggarwal informed shareholders that the company has been actively working on developing alternatives to rare-earth magnets for the past two years. The program was accelerated earlier this year when China tightened its export rules, prompting Ola Electric to fast-track development and production.
“We’ve successfully built and productionised motors that do not rely on rare-earth materials. These will be integrated into our upcoming two-wheeler models beginning next quarter,” Mr Aggarwal said in his letter. Rare-earth magnets, prized for their compact size and high efficiency, are a critical component in electric motors used in electric vehicles.
China dominates the global supply chain, accounting for 60% of the world’s rare earth production and nearly 90% of refining. In April, Beijing introduced stricter export rules, making it more difficult to obtain these materials. Importers are now required to submit detailed end-use declarations, including multiple government-level clearances.
Mr Aggarwal noted that Ola Electric’s vertically integrated manufacturing—covering in-house development of motors, motor controllers, and software—has allowed the company to respond quickly to the disruption. “We have sufficient inventory and are sourcing magnets from two different countries to meet our short-term needs,” he explained. “And since we aren’t dependent on third-party motor suppliers, we’ve been able to adapt faster and scale up new sourcing strategies.”
The supply crunch has affected others in the industry as well. Both Bajaj Auto and TVS Motor have publicly raised concerns over delays and complications in sourcing magnets from China, warning that production could be impacted.
Efforts to reduce dependence on rare-earth magnets are gaining momentum across the automotive sector. Several component manufacturers in India and abroad—including Mahle, Valeo, Sterling Gtake, Sona Comstar, Greaves Cotton, Chara Technologies, and Attron Automotive—are investing in research to develop alternative motor technologies that do not rely on these materials.
However, challenges remain. Industry experts caution that while rare-earth-free solutions hold promise, they are still in early stages of adoption. Many alternatives struggle with issues such as lower power output, reduced efficiency, and increased motor size and weight—key concerns for high-performance electric vehicles. Despite the hurdles, Ola Electric’s shift away from rare-earth dependence signals a bold step toward building more resilient, locally engineered electric mobility solutions.
Ola Electric is India’s largest electric vehicle manufacturer, focused on end-to-end development of electric mobility solutions. Its Futurefactory in Tamil Nadu is one of the country’s largest EV production hubs, while the Battery Innovation Centre in Bengaluru leads advanced battery cell R&D. Ola’s innovation teams span across India, the UK, and the US, driving development of core EV technologies. With over 4,000 retail stores and a robust digital platform, the company operates India’s most extensive EV distribution network under a fully-owned retail model.
