This paper presents a comparative analysis of electric machine designs for vehicle traction using traditional steel laminations versus soft magnetic composite (SMC) materials in four radial flux magnetic topologies: Rare-earth interior permanent magnet synchronous machine (IPM), wound field synchronous machine (WFSM), spoke-ferrite permanent magnet synchronous machine (SP-FER), and induction machine (IM). In total, 32 machine variants are evaluated considering different materials, and they are critically evaluated against a reference IPM traction machine with regards to performance, material cost and environmental impact. Results show that while the IPM design remains superior in performance for a fixed geometry, the WFSM and SP-FER offer significant environmental advantages. The WFSM emerges as the most eco-friendly option, while the SP-FER represents a balanced choice considering environmental impact, durability, production simplicity, and inverter complexity. This study highlights the potential of SMC materials compared to steel laminations in reducing costs (16 % to 29 %) and CO2-eq. emissions 21 % to 38 % in electric motor manufacturing without significantly compromising on performance, making it a viable alternative in automotive applications.