Electric motor industry: the supply chain is reshaping

The market research and strategy consulting company Yole Intelligence, part of Yole Group has developed comprehensive power electronics expertise for more than ten years, with specific investigations fully dedicated to the automotive applications. All year long, Yole’s analysts deliver significant analyses, including technology and market reports and teardowns throughout the year. More information.
Today, one of the main drivers for power electronics is vehicle electrification. The vehicle electric motor is a key part of the powertrain and any change in the motor will impact the characteristics of the other components of the powertrain, such as the battery and inverter.
In this regard, Yole’s power electronics team releases the report Motors for automotive 2022 – Focus on full-electric vehicles. This technology and market study analyzes the challenges and opportunities of this industry in detail. Yole provides an overview of the technologies, highlights the technical disruptions, and presents detailed market data. The company also delivers a valuable understanding of the value chain, infrastructure, and competitive landscape with an in-depth analysis of the OEMs’ strategies.

One key point for electric motor manufacturing is that the magnets used in PMSM are made with rare-earth materials, with refineries mainly in China. The magnets can account for up to 40% of the total PMSM cost. Non-Chinese vehicle makers that use PMSMs may suffer severely from magnet shortages or cost fluctuations if one of the following scenarios happens:
• The Chinese government imposes restrictions on rare-earth material exports to satisfy local demand.
• China enters a conflict with Taiwan, and American and European governments impose commercial sanctions on the Chinese government.
Considering both scenarios, Yole’s analysts expect non-Chinese vehicle makers to reduce their dependence by developing new technologies or improving existing magnet-free technologies. Vehicle makers mainly use one of three business models for traction motors: in-house manufacturing; outsourcing; and a hybrid business model that combines in-house manufacturing and outsourcing. The traction motor is part of the powertrain. There is also a definite trend toward integrating all the powertrain elements, with vehicle makers adopting a holistic approach that considers the powertrain as a single item.
This holistic approach completely reshapes the motor supply chain:
• Vehicle makers have a single supplier for the powertrain or manufacture their powertrain in-house.
• Motor and inverter manufacturers increase their competencies by acquiring other companies or investing to offer complete solutions to their clients.
The traction motor market is led by three vehicle makers: Tesla, BYD, and Volkswagen. In the Motors for automotive – Focus on full electric vehicles report, Yole’s power electronics team reviews what the leading Tier 1 part suppliers are doing, such as Nidec and Vitesco. They are very aggressive players in this highly competitive landscape, with impressive investments in motor manufacturing and numerous partnerships with vehicle makers.