This paper presents a comparison of 30/8 and 12/8 AC permanent magnet motors with distributed (DW) and concentrated winding (CW) designed for electric vehicle traction. Both prototypes are based on an interior permanent magnet (IPM) motor topology and contain V-shape magnets. The radial flux AC IPM motors were designed for an 80 kW propulsion system to achieve 125 N·m. Finite element models (FEM) used to design the geometry of IPM motors and the required useful parameters of electric motors are widely investigated. The accuracy of finite element models is verified and validated on the basis of test data. Numerical simulations of healthy and faulty operation states, and studies of winding faults based on the FEM offer a deeper understanding of the associated phenomena. Therefore, in this paper, a short-circuit fault in a stator winding was simulated to investigate the transient currents under an external load collapse, for all winding phases. These simulations were used to define other important machine parameters to improve mechanical reliability of the motors and to assess the potential risk of permanent magnet (PM) demagnetization. Furthermore, the analysis of local magnetic forces affecting the PMs in the rotor and their possible displacement in a short-circuit situation were performed, also taking into account the centrifugal force. Lastly, it is demonstrated that the choice of winding configuration has a significant impact on the uncontrolled displacement of magnets in the rotor.