Leading Indian electric vehicle manufacturers Ola Electric and TVS Motor are transitioning to ferrite-based electric motors in a strategic move to minimise their dependency on rare-earth materials, as per Business Standard report. This shift not only lowers exposure to volatile global supply chains but also opens the door to more cost-effective and localised production options.
Ola and TVS plan to phase out rare-earth magnets in upcoming electric two-wheelers and substitute them with ferrite magnets. Ferrite magnets are less expensive and widely available compared to rare-earth counterparts, especially those sourced from geopolitically sensitive regions.
Ola is reportedly collaborating with global partners to develop high-performance ferrite-based motors, re-engineered for improved efficiency. TVS is also actively experimenting with similar alternatives to stay technologically competitive while enhancing domestic manufacturing strength.
Ferrite magnets offer a practical advantage by being low-costlow cost and abundant globally, reducing risks during raw material disruptions. Consequently, EV makers can lower production costs and improve localisation. Additionally, unlike rare-earth materials largely sourced from limited foreign suppliers, ferrite magnets allow for broader sourcing options, strengthening the supply chain resilience of Indian automakers.
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Despite their benefits, ferrite magnets come with technical limitations such as lower magnetic flux, which can influence EV performance levels, particularly torque and speed. They are also more susceptible to demagnetisation at extreme temperatures. However, with evolving motor designs, manufacturers are working to offset performance gaps through innovative engineering adjustments.
The shift reflects a broader global movement where automobile firms, including some German manufacturers, have already started implementing ferrite magnet solutions in motors. Backed by policy momentum in India, including upcoming incentives for rare-earth alternatives, Ola and TVS appear well-positioned to scale up environmentally friendly, cost-effective EV production with reduced foreign reliance.
On July 23, 2025, Ola Electric share price opened at ₹40.35 on NSE, above the previous close of ₹40.17. During the day, it surged to ₹40.55 and dipped to ₹39.90. The stock is trading at ₹40.25 as of 11:42 AM. The stock registered a marginal change of 0.20%.
Over the past week, it has declined by 4.53%, over the past month, it has declined by 6.96%, and over the past 3 months, it has declined by 23.41%.
On July 23, 2025, TVS Motor Company share price opened at ₹2,809.40 on NSE, above the previous close of ₹2,795.40. During the day, it surged to ₹2,835.60 and dipped to ₹2,793.10. The stock is trading at ₹2,795.60 as of 11:42 AM. The stock registered a marginal change of 0.01%.
Over the past week, it has declined by 2.89%, over the past month, it has declined by 4.16%, and over the past 3 months, it has declined by 0.40%.
Ola and TVS adopting ferrite motors marks a crucial shift towards cost efficiency, localisation, and long-term sustainability in India's EV sector. While challenges remain around performance and heat durability, collaborative global development and domestic policy support may help accelerate the transition
Disclaimer: This blog has been written exclusively for educational purposes. The securities or companies mentioned are only examples and not recommendations. This does not constitute a personal recommendation or investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
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Published on: Jul 23, 2025, 1:24 PM IST
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