Rare Earth Magnet Shortage Impacts Bajaj, Ather, TVS Production Output, While Ola Electric Leads

India’s electric two-wheeler industry faces disruption due to a rare earth magnet shortage, stemming from export restrictions by China. Bajaj Auto, Ather Energy, and TVS Motor are slashing production, while Ola Electric maintains steady output, seizing a competitive lead in the domestic market.

Bajaj, Ather, and TVS Slash EV Output 

The ongoing 4th-month supply crunch of heavy rare earth magnets, crucial for EV motors, is forcing major Indian electric 2-wheeler makers to scale down production. As per Economic Times, Bajaj Auto is reportedly slashing output by 50%, significantly impacting its Chetak models. Ather Energy is also reducing its monthly production by 8% to 10%, whereas TVS Motor has acknowledged short-term disruptions but hasn't detailed the extent.

Presently, Bajaj Auto holds a 22% market share, having sold 23,004 units in June 2025. Ather Energy recorded 4,512 units, holding 14%, while TVS Motor, which leads with 24%, sold 25,274 units in the same month. All three are navigating sourcing challenges and exploring alternative magnet suppliers or technology adjustments to restore supply stability.

Production Disruption Timeline and Market Implications

The Chinese export restrictions on rare earth magnets have been in place for four months, severely impacting global EV component supply. These magnets, essential for motor efficiency and energy conversion, are mostly produced in China, making Indian EV makers vulnerable to such export decisions. The current disruption could affect the upcoming festive sales season, often critical for the automobile industry.

Read More: India's EV Sales Double YoY in June, Account for 5% of New Vehicles: FADA!

Ola Electric’s Strategic Advantage 

Amidst the supply disruption, Ola Electric stands resilient with an unaffected production line, thanks to a visible stockpile of rare earth magnets. The company has not revealed the magnitude of these stockpiles but confirmed that output continues unhampered. This positions Ola Electric as a clear beneficiary in the Indian EV demand scenario, offering uninterrupted deliveries as rival supply chains falter.

Conclusion

The rare earth magnet shortage is reshaping competition dynamics in India's EV landscape. While Bajaj, Ather, and TVS scramble for supply chain solutions, Ola Electric secures a favourable position due to prior inventory planning. The ultimate impact will unfold in the coming months, depending on China's policy and domestic sourcing alternatives.

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