Ather Faces Supply Disruption Amid Rare Earth Magnet Shortage

Ather Energy has warned of a temporary disruption in vehicle supply to its dealerships due to a shortage of rare earth magnets sourced from China. 

The company anticipates that this supply chain issue could impact its ability to meet dealer demand for up to seven days during the July-September quarter of the current financial year. 

While Ather is leveraging existing channel inventory to cushion the blow, the limited stock buffers mean that retail operations may still experience some short-term setbacks.

Critical Role of Rare Earth Magnets

Rare earth magnets are essential components in electric vehicles, offering high performance in compact sizes and playing a vital role in both powertrains and digital systems. The automotive industry relies heavily on these magnets for enhanced energy efficiency and critical functionality. 

However, China, which produces 60 per cent of the world’s rare earth elements and controls about 90 per cent of global refining capacity, has suspended magnet exports since April. 

This move has put automakers, including Ather, on high alert as they scramble to secure alternative supplies and maintain production schedules.

Desperate Search for Alternatives

The ongoing supply crunch has prompted companies across the sector to accelerate the development of long-term solutions. 

Many are now exploring magnet-free motor tech and shifting towards ferrite-based magnets, which are more readily available and less susceptible to supply chain volatility. 

Ather Energy is actively considering a transition to light rare earth magnets, which are not subject to the current export ban, or even partial motor assembly in China to bypass restrictions. 

The company is also evaluating the use of ferrite-based motor technologies as a potential alternative.

Ather’s Expansion Plans

The rare earth magnet shortage comes at a crucial time for Ather Energy, as the company aims to ramp up production ahead of the festive season and expand its retail footprint across India. 

Despite the supply chain hiccup, Ather remains committed to its aggressive growth strategy, targeting over 750 stores by year-end. 

Also read: Is E20 Fuel Safe for Older Cars? Complete Guide for Indian Car Owners