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Every car has a heartbeat. In an electric vehicle, that heartbeat is powered by a tiny, invisible force: rare earth magnets. They sit quietly inside motors, making the wheels turn, quite literally moving the future forward.
But in July 2025, something happened that made these behind-the-scenes components the centre of attention. Sona Comstar, one of India’s most ambitious auto parts companies and a key supplier to global EV giants, announced it would begin manufacturing rare earth magnets right here in India.
For a company that imported 120 tonnes of these from China last year, this was a radical shift. For the country, it could be a turning point.
Because this isn't just about one company going local. It's about a critical piece of the EV puzzle and India’s rising urgency to stop depending on China for it.
So, why now? What’s changed? And what could this mean for India's EV ambitions and industrial strategy?
Let’s break this down
First, what happened?
It began with a restriction. In April 2025, China, which produces nearly 90% of the world’s rare earth magnets, tightened its exports in response to new U.S. tariffs. For a global EV supply chain already stretched thin, this added new anxiety.
For Sona Comstar, India’s biggest magnet importer and a critical supplier to brands like Tesla and Stellantis, it was more than anxiety; it was a wake-up call.
At the same time, the Indian government began crafting a policy to incentivize local magnet production. With the world’s third-largest car market and the fifth-largest reserves of rare earths, India had the raw ingredients but not the ecosystem.
That’s when Sona Comstar stepped in, becoming the first Indian company to publicly commit to manufacturing magnets domestically.
Why are rare earth magnets so important?
They're not just important, they're essential. Without them, EV motors don’t run. These magnets enable the electric torque that moves the vehicle. But the catch is, while rare earths are found in several parts of the world, the tech to refine and manufacture magnets at scale remains largely with China.
For an EV-supplying nation like India, this is a strategic blind spot. And for Sona Comstar, whose EV components already contribute 35% of revenue and are embedded in everything from US cars to European fleets, the dependency on Chinese magnets was becoming a liability.
This is why localising production is not just good optics but a business necessity.
Rare earth magnet demand: Then vs What’s Coming
(All figures in thousand tonnes)
Source: International Energy Agency, Global Critical Mineral Outlook 2024
What does this mean for India?
This could be India’s EV supply chain moment. Until now, the country has built a reputation as an assembler, not a manufacturer of advanced components. But rare earth magnets are not just any component, they’re among the most technically demanding, capital-intensive parts of an EV motor.
If Sona Comstar can crack this, it opens the door for a broader shift. It means less reliance on imports, more value creation locally, and a chance for India to climb up the EV value chain. It also shows that Indian companies are willing to bet big on the future not just in terms of demand, but in controlling the core tech that powers it.
Winners and Watchers
Sona Comstar itself gains first. It has grown fivefold in the last five years, crossing $400 million in revenue, and is now signalling its readiness to take on China’s dominance head-on. EV makers benefit too, with a more stable and local supply chain.
And for the government, this move aligns perfectly with its vision for Atmanirbhar Bharat in advanced manufacturing.
But many are watching closely. Other auto suppliers evaluating whether to localise. Global OEMs tracking India’s magnet capabilities. Policy-makers shaping how generous the incentives will be. And global investors are looking for signals that Indian manufacturing is truly scaling up.
Will this really reduce dependence on China?
Not overnight. Even with the raw material reserves, India lacks the processing and production infrastructure that China has built over decades. Mining, refining, and magnet assembly are complex and capital-heavy. Sona Comstar’s plans are a start, but they don’t remove the need for Chinese supply in the short term.
That said, in the medium to long term, it absolutely shifts the trajectory. It builds in-house expertise and creates proof of concept. This will make it easier for other companies: domestic or foreign to consider India as a magnet hub.
What else is changing at Sona Comstar?
Following the appointment of a new chairman, CEO Vivek Vikram Singh assured investors that the company’s strategic direction remains unchanged and that its internal leadership bench is strong enough to navigate any disruption.
Meanwhile, the financials remain solid. Net profit for Q4 FY25 hit a record ₹164 crore, despite a slight dip in revenue. The EV segment continues to grow, and the company’s total order book has reached ₹24,200 crore with 77% linked to EV programs.
Domestically, Sona Comstar is also diversifying beyond automotive. After acquiring Escorts Kubota’s Indian railways business, it expects the majority of its revenue in FY26 to come from India rather than overseas.
The bottom line
This isn’t just about magnets. It’s about India’s industrial confidence. For decades, we’ve relied on imports for the most complex parts of what we build. Now, companies like Sona Comstar are showing that with capital, clarity, and commitment, we can flip that script.
Because the future of EVs and India’s role in that future may depend on tiny, powerful magnets. And for the first time, we might just make them here.
FAQs
What does Sona Comstar do?
Sona Comstar (Sona BLW Precision Forgings) is an Indian auto components manufacturer that supplies drivetrain and motor parts to global EV and ICE vehicle makers, including Tesla and Stellantis.
Why is Sona Comstar starting magnet production in India?
Sona Comstar aims to reduce its reliance on China for rare earth magnets after export restrictions and align with India’s push for local EV supply chain manufacturing.
What are rare earth magnets used for?
Rare earth magnets are critical components in EV motors, wind turbines, and other high-efficiency electrical systems due to their strong magnetic properties.
How much rare earth magnet does Sona Comstar import from China?
As of FY24, Sona Comstar imported around 120 metric tonnes of rare earth magnets from China and had planned to import 200 tonnes this year.
How much of Sona Comstar’s revenue comes from EVs?
Electric vehicle components contribute about 35% of Sona Comstar’s revenue, and the share is expected to grow as the EV market expands.
What is the size of Sona Comstar’s EV order book?
As of Q4 FY25, Sona Comstar’s total order book stood at ₹24,200 crore, with 77% of it linked to EV programs globally.
Who are the key clients of Sona Comstar?
Sona Comstar supplies components to major auto companies like Tesla, Stellantis, and several EV makers in North America, Europe, and Asia.
Is India producing rare earth magnets locally?
India has rare earth reserves but limited local production. Sona Comstar is the first Indian company to announce domestic magnet manufacturing.
Why are rare earth magnets important for EVs?
Rare earth magnets are used in EV traction motors to deliver high power efficiency, making them essential for performance and battery savings.
How did Sona Comstar respond to the China export ban?
Sona Comstar announced plans to begin local magnet production in India, working with the government to reduce import dependency and secure supply.
What is the future outlook for rare earth magnet demand?
Global demand for rare earth magnets is expected to nearly double by 2050, with clean energy and EVs driving over half of that growth.
Who is the new chairman of Sona Comstar?
Following the death of Sunjay Kapur in June 2025, Jeffrey Mark Overly was appointed as chairman. He brings over 40 years of global leadership experience.
