Toyota has found a way to reduce the amount of a rare earth metal used in magnets for electric car motors by around 20 per cent. This could cut the cost of producing electric cars and reduce the risk of a supply shortage of materials needed for their production.

The Japanese car-maker on Tuesday said it had developed a magnet which replaces some of the neodymium, a rare earth metal used in the world's most powerful permanent batteries, with more abundant and cheaper lanthanum and cerium, adding that it aimed to use the magnets in electric vehicle motors within 10 years.

As production of hybrid and other electric cars is expected to ramp up in the coming years, automakers and electronics companies have been developing new high-powered magnets which require less rare earth metals to reduce costs and trim exposure to possible fluctuations in supply.

Automakers, including Honda, have found ways to eliminate dysprosium and terbium, which cost around $400 and $900 per kilogramme, respectively from magnets by increasing the amount of neodymium, which costs around $100 per kilogramme. – Reuters