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The rare earth magnets are sourced from China and used in the electric traction motors of e-scooters produced by the EV brands in the Indian market
Several leading EV brands in India namely Bajaj Auto, Ather Energy and TVS Motor Company are likely to reduce production due to the disturbance in the supply of heavy rare earth (HRE) magnets from China. The electric two-wheeler companies have been facing this unfavourable situation for the past four months and it has finally resulted in a production cut. However, Ola Electric, yet another e2w startup based in Bengaluru, claimed that it will have no impact of the HRE magnets shortage and the production will continue uninterrupted.
The Pune-based mainstream player, Bajaj Auto, will be impacted the most by the dearth of HRE magnets as it has decided to reduce the production by half. Ather Energy will also bring down the manufacturing of e-scooters by 8-10 percent due to the paucity of rare earth magnets. TVS Motor Company, which has been ruling the electric two-wheeler segment for the last three months, will also scale down production to cope up with this scantiness.
For those asking, rare earth magnets are used in the electric traction motors of the EVs. “The disruptions in the EV supply chain, particularly concerning magnet availability, continue to pose challenges in the short to medium term. We are working actively to mitigate the prevailing challenges,” a TVS Motor spokesperson said.
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“We’ve started to see some production disruption on the Chetak line. Our R&D and procurement teams are working on alternatives, which are now in advanced stages of development,” said Rakesh Sharma, executive director at Bajaj Auto. Ather Energy spokesperson did not respond to the queries. Just so you know, the four key EV brands namely Ola, Ather, TVS and Bajaj account for 8 out of 10 e-scooters sold in the domestic market.
Coming to Ola Electric, the company stated that it has adequate stock of rare earth magnets which can last at least 5-6 months. In fact, it could increase the production in July up to a certain extent. Though the company is also working on alternate solutions to battle this situation. Ola’s sales performance had witnessed a steep decline in the last few months and it was stripped of the segment leader title by Bajaj and TVS.
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“There is no impact on production because of the rare earth magnets,” an Ola Electric spokesperson said, declining to elaborate further. The top officials from the Union Govt have been in discussions with their counterparts from the Chinese side so that the supplies can be restored at the earliest. The auto brands are also in touch with various other suppliers from Vietnam, Indonesia and Japan.
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