Electric Vehicle Motor Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2021-2031

The Global Electric Vehicle Motor Market is projected to expand from USD 47.04 Billion in 2025 to USD 73.65 Billion by 2031, registering a CAGR of 7.76%. These motors function as vital electromechanical devices within the drivetrain, transforming electrical energy into mechanical power for vehicle propulsion. This growth trajectory is fundamentally underpinned by strict government emission standards and mandates for decarbonization, compelling a strategic shift away from internal combustion engines. Additionally, the adoption rate in major economies is being expedited by financial incentives, such as tax subsidies, which effectively reduce costs for consumers. As reported by the China Association of Automobile Manufacturers, sales of new energy vehicles hit 12.87 million units in 2024, demonstrating significant demand for these critical propulsion components.

However, the market faces a substantial obstacle in its dependence on rare earth elements needed for high-performance permanent magnet motors. The sector relies heavily on materials such as dysprosium and neodymium, which are characterized by volatile prices and supply chains that are geographically concentrated. This exposure introduces cost unpredictability and potential sourcing hazards that may limit manufacturing scalability as the global demand for electrification grows.

Market Drivers

The market is being fundamentally reshaped by accelerated electrification strategies and significant capital investments from leading automotive OEMs. Major manufacturers are directing substantial funds toward dedicated electric platforms and production facilities to ensure supply chain resilience, thereby creating high-volume demand for propulsion systems as they compete for market share. For instance, Hyundai Motor Group announced in a March 2024 press release a commitment of 68 trillion won over three years to enhance its EV capabilities, reflecting how motor demand aligns with vehicle production trends. Furthermore, the International Energy Agency projects that global electric car sales will reach approximately 17 million units in 2024, highlighting the critical necessity for scalable manufacturing operations.

Simultaneously, technological progress in high-power density and high-efficiency motor architectures is propelling market evolution. Suppliers are engineering integrated electric drive units, such as modular electric axle systems that consolidate the transmission, inverter, and motor into compact packages to optimize space. Innovations like hairpin winding technology are also being implemented to boost thermal efficiency without increasing weight, generating considerable commercial momentum for component providers. Highlighting this demand for next-generation powertrain solutions, Schaeffler reported in November 2024 that its Automotive Technologies division secured 4.4 billion euros in electric mobility orders during the first nine months of the year.

Market Challenges

A major obstacle to the growth of the Global Electric Vehicle Motor Market is the heavy reliance on rare earth elements, specifically dysprosium and neodymium. High-performance permanent magnet motors, which are prevalent in the sector due to their superior power density and efficiency, are dependent on these critical minerals. The supply chain for these materials is geographically concentrated, resulting in a single point of failure that exposes the industry to supply bottlenecks and geopolitical trade restrictions. This dependency limits the capacity of motor manufacturers to ensure consistent production, thereby hindering efforts to scale operations in accordance with the increasing global trend of vehicle electrification.

Furthermore, market stability is compromised by the volatile pricing of these essential inputs, which disturbs cost structures and discourages long-term investment. According to the Association of China Rare Earth Industry, the price index for rare earth elements showed significant instability in 2024, dropping by roughly 20% by the middle of the year following periods of fluctuation influenced by supply dynamics and regulatory changes. This unpredictability regarding material costs creates financial uncertainty for manufacturers, complicating the forecasting of profit margins and the securing of stable supply contracts. Consequently, this vulnerability to erratic raw material markets directly impedes the industry's ability to sustain the steady growth needed to satisfy future demand.

Market Trends

A prevailing trend in the industry is the transition toward 800-volt high-voltage motor architectures, as manufacturers aim to alleviate range anxiety through enhanced system efficiency and ultra-fast charging capabilities. By doubling the operating voltage from the standard 400 volts, automakers can drastically lower the current needed for equivalent power output, facilitating lighter wiring harnesses and more compact motor designs with better thermal management. This shift is intrinsically connected to the widespread adoption of Silicon Carbide (SiC) semiconductors in motor control units, which manage higher thermal loads and minimize switching losses more effectively than traditional silicon. In its fiscal year 2024 report published in November 2024, Infineon noted generating 650 million euros in Silicon Carbide revenue, underscoring the vital role these advanced materials play in enabling high-voltage automotive propulsion systems.

In parallel, there is a strategic movement toward rare-earth-free magnetless designs, such as Electrically Excited Synchronous Motors (EESM), intended to eliminate supply chain risks linked to dysprosium and neodymium. Unlike permanent magnet motors, these configurations utilize copper windings instead of rotor magnets, providing manufacturers with immunity from raw material price volatility and geopolitical trade restrictions while allowing for tunable magnetic fields to optimize efficiency at high speeds. This architecture not only ensures production stability but also supports corporate sustainability objectives by substantially reducing the lifecycle emissions of electric powertrains. For example, a clearer indication of this benefit appeared in an October 2024 press release from Valeo, stating that their jointly developed magnet-free axle system is expected to lower the carbon footprint by more than 40% compared to an equivalent permanent magnet electric motor.

Key Players Profiled in the Electric Vehicle Motor Market

• Nidec Corporation
• Robert Bosch GmbH
• ZF Friedrichshafen AG
• Siemens AG
• Mitsubishi Electric Corporation
• Continental AG
• Hitachi Automotive Systems, Ltd.
• Toshiba Corporation
• Dana Incorporated
• YASA Ltd.

Report Scope

In this report, the Global Electric Vehicle Motor Market has been segmented into the following categories:

Electric Vehicle Motor Market, by Power Rating:

• Less than 40 Kw
• 40 Kw-80 Kw
• More than 80 Kw

Electric Vehicle Motor Market, by Motor Type:

• Brushless Motors
• DC Brushed Motors
• Induction (Asynchronous) Motors
• Switched Reluctance Motors
• Synchronous Motors

Electric Vehicle Motor Market, by Demand Category:

• OEM
• Aftermarket

Electric Vehicle Motor Market, by Region:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Electric Vehicle Motor Market.

Available Customization

The analyst offers customization according to your specific needs. The following customization options are available for the report:

• Detailed analysis and profiling of additional market players (up to five).

This product will be delivered within 1-3 business days.