Modal Motors
High-torque, high-efficiency non-rare-earth electric motors and generators for B2B applications, made in the USA.
Website: https://www.modalmotors.com/
Cover Block
Open sources
| Attribute | Details |
|---|---|
| Name | Modal Motors |
| Tagline | High-torque, high-efficiency non-rare-earth electric motors and generators for B2B applications, made in the USA. |
| Headquarters | Farmington Hills, USA |
| Founded | 2024 |
| Stage | Seed |
| Business Model | B2B |
| Industry | Deeptech |
| Technology | Hardware |
| Geography | North America |
| Growth Profile | Venture Scale |
| Founding Team | Co-Founders (2) |
| Funding Label | Seed (total disclosed ~$2,100,000) |
Links
Open sources
- Website: https://www.modalmotors.com/
- LinkedIn: https://www.linkedin.com/company/modalmotors
- X / Twitter: https://x.com/modalmotors
What an Investor Needs First
Open sources Modal Motors is a deeptech hardware startup commercializing a new class of electric motors that aim to decouple high performance from reliance on Chinese-controlled rare-earth minerals, a timely bet given escalating supply chain and geopolitical pressures [Charged EVs, 2025]. The company, spun out from Veolectra, Inc. in 2024, is built on a patent-pending Transverse Flux Motor (TFM) architecture it claims delivers superior torque density and efficiency while using non-rare-earth or U.S.-and-allied sourced magnets [DBusiness, 2024].
Founders Michael and Ebru Van Steenburg are leveraging Michigan's automotive heritage to target B2B OEMs across e-mobility, robotics, and data centers, with a clear initial wedge into the drone propulsion market. The business model is direct sales of motors and generators, with its first product, the OR3627-900kV, now open for orders ahead of planned Q4 2026 deliveries [Yahoo Finance / PR Newswire, June 2026].
Having raised a seed round of approximately $2.1 million, the company is in a capital-efficient validation phase, funding its initial production ramp in Farmington Hills. The critical watchpoint over the next 12-18 months is the transition from announced order books to validated, volume customer shipments and third-party performance data, which will test both its technical claims and its ability to scale a domestic supply chain.
Partially corroborated -- Core company facts and product claims are confirmed by primary sources; funding details are partially corroborated but lack lead investor confirmation.
Taxonomy Snapshot
| Axis | Value |
|---|---|
| Stage | Seed |
| Business Model | B2B |
| Industry / Vertical | Deeptech |
| Technology Type | Hardware |
| Geography | North America |
| Growth Profile | Venture Scale |
| Founding Team | Co-Founders (2) |
| Funding | Seed (total disclosed ~$2,100,000) |
Inside the Company
Open sources
Modal Motors was formed in 2024 as a corporate spinout from Veolectra, Inc., a move intended to commercialize patent-pending electric motor technology [DBusiness, 2024]. The company is headquartered in Farmington Hills, Michigan, a location that aligns with its stated goal of enabling local manufacturers to compete in global e-mobility and equipment markets [Perplexity Sonar Pro Brief].
The company's timeline shows a focus on securing capital and moving toward production. In 2025, Modal Motors raised a seed round, reported at $2 million by Charged EVs, to fund U.S. production [Charged EVs, 2025]. A separate database entry notes a $764,287 portion of a larger $2.1 million seed round closing in October 2025, suggesting a staggered or multi-investor financing structure [Preqin]. The most significant commercial milestone to date is the June 2026 announcement that order books were open for its first product, the OR3627-900kV Drone Propulsion Motor, with first deliveries scheduled for Q4 2026 and high-volume fulfillment targeted for Q1 2027 [Yahoo Finance / PR Newswire, June 2026].
Partially corroborated -- Founding and funding details are reported by third-party publications, but key details like the lead investor and full capitalization are not publicly disclosed.
Under the Hood
Reported and inferred Modal Motors’ product strategy centers on a single, publicly detailed hardware unit: the OR3627-900kV Drone Propulsion Motor. The company announced in June 2026 that this motor was available for order, with first deliveries scheduled for Q4 2026 and high-volume fulfillment targeted for Q1 2027 [Yahoo Finance / PR Newswire, June 2026]. The motor is presented as a flexible platform, described as being customizable for land, sea, air, robotics, or data center applications beyond its initial drone focus [Yahoo Finance / PR Newswire, June 2026]. This launch marks the company’s transition from R&D to commercial availability, anchoring its claims in a tangible, orderable product.
The underlying technology is built around a patent-pending Transverse Flux Motor (TFM) architecture, which the company states delivers the highest torque density and efficiency in its class [Modal Motors, retrieved 2026]. A core differentiator is the material supply chain. Modal Motors manufactures both non-rare-earth and U.S.-sourced rare-earth electric motors, specifically utilizing iron nitride (FeN) from Niron Magnetics and samarium iron nitride (SmFeN) from USA-and-allied partners [Modal Motors, retrieved 2026]. The company asserts this 100% USA-and-allied supply chain allows its motors to outperform Chinese rare-earth alternatives while achieving the lowest cost of goods sold (COGS) in class [Modal Motors, retrieved 2026].
Public materials reference two other product concepts, though without the same commercial detail as the drone motor. The website lists a “Modular Motor 01” described as having three coils and zero dead weight, and a “Hybrid Enigma Drive 02” framed as one motor with multiple inputs and outputs [Modal Motors, retrieved 2026]. These appear to be earlier-stage or conceptual designs. The company’s public claims of third-party validation and over 25 issued patents suggest a foundation of prior R&D, though the specific test reports or validating entities are not named [Modal Motors, retrieved 2026].
Verified against public records -- Product claims and specifications are confirmed by the company’s website and a press release distributed via PR Newswire.
Market Research
Open sources The market for electric motors is undergoing a foundational shift, driven less by incremental efficiency gains and more by geopolitical and supply chain pressures that are redefining sourcing priorities for industrial buyers.
Modal Motors positions itself within the broader market for specialized electric motors used in propulsion and actuation, a segment where performance and supply chain provenance are increasingly valued over cost alone. The company's initial product, the OR3627-900kV Drone Propulsion Motor, targets the commercial and industrial drone market, which is itself a subset of the larger electric motor ecosystem. While Modal Motors has not published its own market sizing, the strategic wedge is clear: it aims to serve B2B customers, particularly original equipment manufacturers (OEMs), who are prioritizing a secure, U.S.-and-allied supply chain for critical components [Modal Motors, retrieved 2026]. This focus aligns with a growing trend among manufacturers in sectors like e-mobility, robotics, and defense to de-risk their reliance on materials and components sourced from geopolitical rivals.
Demand drivers for this specific wedge appear multifaceted. The primary tailwind is the geopolitical push for supply chain sovereignty, particularly in the United States, where legislation like the Inflation Reduction Act and Defense Production Act create incentives for domestic manufacturing of critical technologies. A secondary driver is the ongoing electrification of transport and industrial equipment, which expands the total addressable market for high-performance motors. Modal Motors' CEO, Michael Van Steenburg, explicitly stated the company's goal is to enable Michigan manufacturers to compete globally, especially against China [MITech TV / YouTube, 2026]. This suggests demand is being pulled not just by performance specs but by a desire for competitive insulation from foreign supply chain disruptions.
Key adjacent markets that could serve as substitutes or expansion vectors include the broader market for rare-earth permanent magnet motors, which currently dominate high-performance applications. Modal's technology, which utilizes alternative materials like iron nitride (FeN) from partners such as Niron Magnetics, positions it as a direct substitute within that performance tier [Modal Motors, retrieved 2026]. Other adjacent sectors mentioned by the company include data center cooling (where efficient motors drive fans and pumps), marine propulsion, and robotic actuators. The regulatory environment is broadly supportive, with U.S. industrial policy explicitly favoring domestic production of essential goods, though specific motor performance standards and certifications will still apply.
Given the absence of third-party, cited market sizing data for Modal Motors' specific niche, the following table uses analogous public market data to provide context for the segments the company is entering.
| Market Segment | Reported Size (Analogous) | Source & Year | Notes |
|---|---|---|---|
| Global Electric Motors Market | $144.3 billion | [Fortune Business Insights, 2023] | Broad market including all motor types and applications. |
| Global Industrial Motors Market | $27.4 billion | [MarketsandMarkets, 2023] | Subset focused on industrial machinery and automation. |
| Commercial Drone Market | $34.0 billion | [Grand View Research, 2023] | Includes hardware, software, and services; propulsion is a component. |
from these analogous figures is that Modal Motors is operating within large, established markets, but its success hinges on capturing specific, high-value niches where its supply chain and performance claims resonate. The company is not attempting to commoditize the entire motor market but to secure a defensible position within the premium, geopolitically-sensitive segment of it.
Partially corroborated -- Market sizing is based on analogous third-party reports for broader categories; specific TAM/SAM for Modal's non-rare-earth motor wedge is not publicly detailed.
Competition and Substitutes
Reported and inferred Modal Motors enters a hardware market defined by a stark geopolitical and technological divide, positioning its U.S.-manufactured, non-rare-earth motors against entrenched incumbents and a new wave of challengers.
The competitive map must be drawn from broader market categories. The landscape can be segmented into three primary groups: established global motor suppliers, specialized non-rare-earth technology developers, and adjacent system integrators who could vertically integrate.
- Incumbent suppliers. The dominant force is the established global supply chain for permanent magnet motors, heavily reliant on Chinese-sourced rare-earth materials. Companies like Nidec, ABB, and Siemens, along with numerous Chinese manufacturers, offer high-performance, cost-effective motors but are subject to supply chain vulnerabilities and increasing trade restrictions. Their advantage is scale, proven reliability, and deep integration with global OEMs. Modal Motors’ wedge is not performance parity but performance without the geopolitical and supply chain risk associated with these incumbents.
- Technology challengers. A newer segment focuses on developing alternative magnet technologies. Modal’s cited supplier, Niron Magnetics, is a key player here, developing iron nitride (FeN) permanent magnets. Other firms, such as Advanced Magnet Lab (AML) with its flux-focused motor designs, or startups like Turntide Technologies promoting switched reluctance motors, are pursuing similar goals of reducing or eliminating rare-earth dependence. Modal’s claimed differentiator is not the magnet material itself but its integration into a proprietary, patent-pending Transverse Flux Motor (TFM) architecture it says yields superior torque density and efficiency.
- Adjacent substitutes and integrators. For specific applications like drone propulsion or robotics, Modal also competes with specialized motor makers (e.g., T-Motor, KDE Direct for drones) and with OEMs who may choose to design motors in-house. The competitive threat is not always a direct motor-for-motor swap but the customer’s decision to accept the supply chain status quo or invest in internal development.
Modal’s defensible edge today rests on two pillars: its integrated technology stack and its supply chain narrative. The company is commercializing a specific motor architecture (TFM) designed around alternative magnets, claiming third-party validation and 25+ issued patents in its lineage from Veolectra [Modal Motors, retrieved 2026]. This integration of design and material sourcing is a technical moat, though its depth is unproven at volume. The second edge is its “100% USA-and-allied supply chain” story, which is a potent regulatory and strategic advantage in defense, aerospace, and infrastructure sectors where provenance matters. This edge is durable if trade tensions persist and if U.S. industrial policy continues to favor onshore manufacturing, but it is perishable if competitors successfully replicate the supply chain or if geopolitical priorities shift.
The company is most exposed on commercial execution and cost. While it claims the “lowest COGS in class” [Modal Motors, retrieved 2026], this remains a website assertion without public, detailed benchmarks against volume-produced Chinese motors. A competitor like Nidec, with decades of manufacturing optimization and global scale, could likely undercut Modal on pure unit cost for a standard design. Furthermore, Modal’s initial focus on the drone market via the OR3627-900kV motor [Yahoo Finance / PR Newswire, June 2026] brings it into direct competition with established specialists who have deep customer relationships and application-specific expertise. Modal does not yet own a dominant channel or have announced major OEM design wins, leaving it vulnerable to being sidelined if it cannot transition from taking orders to securing multi-year supply agreements.
The most plausible 18-month scenario hinges on the success of its first product launch and the expansion of its supply chain. If Modal demonstrates reliable, volume production of the OR3627 motor in Q1 2027 as planned and secures a visible design win with a U.S.-based drone or robotics OEM, it becomes the “winner” in the narrative of viable, high-performance American motor manufacturing. It would attract follow-on capital and partnership interest for its next application, likely in e-mobility. The “loser” in this scenario would be smaller, less-integrated startups in the non-rare-earth space that fail to move from lab prototype to qualified product, finding themselves outflanked by Modal’s combined go-to-market and technology story. Conversely, if production timelines slip or performance claims are not validated by early customers, Modal risks becoming a cautionary tale about the difficulties of hardware scaling, ceding ground to both incumbents and more capital-efficient challengers.
Partially corroborated -- Competitive analysis is inferred from market categories and the company's stated positioning; no direct competitor names are confirmed in public sources.
Opportunity
Open sources
Modal Motors has the potential to become a foundational supplier of strategic electric motor technology to U.S. and allied-nation industrial and defense OEMs, decoupling critical hardware from geopolitical supply chain vulnerabilities.
The headline opportunity is for the company to establish itself as the default domestic source for high-performance, non-rare-earth permanent magnet motors across a range of priority sectors. The cited evidence suggests this is a reachable outcome, not merely aspirational. The company is already taking orders for its first product, with deliveries scheduled for late 2026 [Yahoo Finance / PR Newswire, June 2026]. Its public positioning explicitly targets OEMs in e-mobility, equipment, robotics, and data centers, with a stated mission to enable U.S. manufacturers to compete globally [MITech TV / YouTube, 2026]. The strategic imperative for a secure, allied-nation supply chain for critical components is a persistent theme in industrial and defense policy, creating a durable tailwind for a qualifying supplier.
Growth could follow several distinct, concrete paths. The table below outlines two primary scenarios.
| Scenario | What happens | Catalyst | Why it's plausible |
|---|---|---|---|
| Drone & Robotics Dominance | Modal becomes the propulsion motor of choice for U.S.-made commercial and tactical drones, expanding into ground robotics. | First-mover advantage with the OR3627-900kV motor, securing a marquee drone OEM design win. | The company has already commercialized a product specifically for drone propulsion and is accepting orders [Yahoo Finance / PR Newswire, June 2026]. The drone market is a known early adopter for new motor technologies. |
| Strategic Industrial Supplier | The company transitions from a component vendor to a Tier-1 or Tier-2 supplier for major automotive, aerospace, or industrial equipment OEMs. | A strategic investment or long-term supply agreement with a major U.S. OEM seeking to de-risk its motor supply chain. | Modal publicly cites sourcing relationships with U.S.-based material suppliers like Niron Magnetics [Modal Motors, retrieved 2026], demonstrating an active effort to build a compliant supply chain that would be attractive to large OEMs. |
Compounding for Modal Motors would likely manifest as a technology and supply chain moat, rather than a classic network effect. Early design wins in one vertical, such as drones, would generate revenue to fund R&D for more powerful motor variants. This expanded product portfolio would then unlock applications in adjacent, higher-value markets like electric vehicles or industrial automation. Each successful deployment would serve as a third-party validation case, reducing the technical risk perceived by the next, larger customer. The company claims its motors are already "third-party validated" [Modal Motors, retrieved 2026], suggesting this flywheel of credibility may have begun.
The size of the win, should the Strategic Industrial Supplier scenario play out, is substantial. A credible comparable is Nidec Corporation, a leading global supplier of precision motors, which reported a market capitalization of approximately $25 billion as of early 2026. While Modal Motors is at an early stage, capturing even a single-digit percentage of the specialized, high-performance segment of the U.S. motor market could support a valuation in the hundreds of millions to low billions of dollars (scenario, not a forecast). The total addressable market is underpinned by the broad shift to electrification across transportation and industry, where motors are a core enabling component.
Partially corroborated -- Growth scenarios are extrapolated from public product and market focus statements; specific catalyst events are not yet public.
Sources
Open sources
[Charged EVs, 2025] Modal Motors raises $2 million in seed funding to bring its electric motors into production in the US | https://chargedevs.com/newswire/modal-motors-raises-2-million-in-seed-funding-to-bring-its-electric-motors-into-production-in-the-us/
[DBusiness, 2024] Startup Spotlight: Modal Motors | https://www.dbusiness.com/daily-news/startup-spotlight-modal-motors/
[F6S] Modal Motors Inc | https://www.f6s.com/company/modalmotors
[MITech TV / YouTube, 2026] High Torque, Non Rare Earth Motors Made In Michigan | https://www.youtube.com/watch?v=3r7y8cCj3V0
[Modal Motors, retrieved 2026] Advanced Electric Motors | Modal Motors | https://www.modalmotors.com/
[Perplexity Sonar Pro Brief] | https://www.perplexity.ai/
[Preqin] | https://www.preqin.com/
[Yahoo Finance / PR Newswire, June 2026] Modal Motors Opens Order Books for its unique OR3627-... | https://finance.yahoo.com/news/modal-motors-opens-order-books-140000180.html
[Fortune Business Insights, 2023] | https://www.fortunebusinessinsights.com/
[MarketsandMarkets, 2023] | https://www.marketsandmarkets.com/
[Grand View Research, 2023] | https://www.grandviewresearch.com/
Articles about Modal Motors
- Modal Motors Opens the Order Book for a Michigan-Made Drone Motor — The Farmington Hills startup is betting its non-rare-earth motor architecture can win B2B OEMs before scaling to land, sea, and data centers.