Study shows how EV manufacturers can reduce reliance on virgin rare earth minerals

The savings may be realized through adoption of a circular manufacturing system decision-making model developed by researchers in Sweden. Based on simulations for the entire life cycle of electric vehicle (EV) engine components, the tool was developed to promote product design which enables eventual remanufacture and reuse, or recycling. 

The results were published in the International Journal of Production Research by researchers at KTH Royal Institute of Technology in Stockholm and Scania Group  including members of the team that provided the feasibility study behind truck manufacturer Scania’s historic rollout of new vehicles with remanufactured components.

Production cost savings of 18.6 percent and overall carbon footprint reduction of 38.7 percent were estimated in a test case involving an electric machine product from the heavy-duty vehicle industry, the researchers report. Material demand was reduced by 14.7 percent.

These benefits can be realized with a design investment of an additional 10.6 percent, says Farazee Asif, a researcher in circular manufacturing systems at KTH Royal Institute of Technology.

Asif says the study reveals how adopting circular design can save the industry significant production costs and lower its demand for energy and materials, while reducing its carbon footprint and waste. “Avoiding virgin material extraction is an important environmental factor,” he says.

The simulations showed that 80 of the electrical steel mass for electric motors could be channeled towards remanufacturing or reuse, while the remaining 20 percent could be channeled towards recycling. Similarly, 60 percent of magnets and 56 percent of regular steel could be channeled towards remanufacturing and reuse, with the remainder going to recycling.

“Circular economy practices are critical for securing future resources in EV manufacturing, especially for rare-earth-heavy parts like electric motors,” Asif says. However, significant design innovations and modeling the economic and environmental impacts of these innovations are still needed. “This paper aims to fill that gap with a new simulation tool,” he says.

The model enables manufacturers to produce detailed and accurate representations of complex production systems, from the smallest actions to macro-level events, says the study’s lead author, Mayarí Perez, a former master student in sustainable production development at KTH.

For instance, rare earth elements such as neodymium, praseodymium and dysprosium are needed to produce the powerful magnets in electric motors, Perez says. The tool enables modeling the activity of suppliers, manufacturers and recyclers, so that a manufacturer can predict the availability of such materials.  It can also simulate the logistics of transporting materials and components, to ensure timely delivery to manufacturing plants.

“By scaling up circular practices, the automotive industry could meet up to 70 percent of future neodymium demand for EVs by 2050,” Perez says. “This study is a contribution toward developing the infrastructure and product end-of-life management that’s needed to reach that goal.”

Working with Asif and Perez on the study were KTH researcher Yongkuk Jeong and Michael Lieder, Business Developer at Scania.

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A simulation-based decision support tool for circular manufacturing systems in the automotive industry using electric machines as a remanufacturing case study. International Journal of Production Research. DOI: 10.1080/00207543.2025.2464912