There aren't enough rare earth elements available for the requisite magnets in DC motors. If adopted, the price would go through the roof, way beyond what the auto industry could / would pay. Similarly there is a supply problem with Lithium, if that is the battery technology employed. See the Jack Lifton Report (sign up to read part 1)
In hybrids, one of the limiting factors is that electric motors overheat, killing the magnets permanently. It's one of the principal reasons that hybrids switch back to ICE drive. Thus no point in having large battery capacity!
Having hub motors might lead to serious unsprung weight issues in cars.
Employing a small ICE running at constant speed / load solely powering a generator which would both power the electric motor and/or charge a battery and/or other storage technology, would provide significantly higher MPG.
Wheeltug, as mentioned above, is based on the Chorus Motor which doesn't have magnets. It has automotive potential See ChorusForCars.
There hasn't been much news from Wheeltug recently, but things are pretty busy on the inside.
(I'm involved)
Last edited by rahosi; 7th Jan 2010 at 14:41.