The expansion of the electric vehicle (EV) market will bring changes in the type of environmental impact generated by the transport sector. This will be partially associated to the introduction of new technologies for energy storage and powertrains, including electric motors technology, which can play a critical role for the EV. To assure its optimal performance, key components and innovative materials are integrated in current motor designs. Such is the case of permanent magnets (PM), commonly made of rare-earth elements, which have a history of ecological concerns related to its mining. The goal of the paper is to study novel traction e-motors and to assess the influence of its components, in the environmental performance of the motor and the electric vehicle. In this study, a life cycle assessment (LCA) is performed, including the manufacturing, use, and end of life stages of a traction electric motor for EV applications. A comparison is presented, where the rare-earth magnets are replaced by ferrite magnets, under several efficiency scenarios. Average European conditions are considered for framing the modeling. A functional unit of 1 km driven by the vehicle is used. Twelve impact categories were selected to present the potential environmental impact of the motors. Energy consumption during the use stage was identified as a hotspot responsible for an important share of the impact. The amount of energy consumed is highly dependent on the efficiencies of the powertrain, which is why improving efficiency should be regarded as crucial for decreasing the environmental damage produced by the motor. The use of rare-earth magnets during manufacturing does not represent a significant share of the impact, as they only take 2 % of the total mass. Other components, including laminations, housing and windings were instead recognized as more significant than the mangets, mainly for climate change, toxicity of humans, soil and water bodies, as well as metal depletion. The use of alternative materials for rare-earth magnets can contribute in the reduction of the potential impact, as long as the overall efficiency of the motor remains the same or increases. Based on the study results, it can be concluded that the environmental performance of traction motor is closely tight to its efficiency. Selection of materials during design should focus more on preserving or improving the efficiency of the motor, than on materials with low environmental impact during production.