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This paper proposes a novel permanent-magnet (PM) flux switching (PMFS) machine with an outer-rotor configuration for in-wheel light traction applications. The geometric topology of the outer-rotor PMFS machine is introduced, and the analytical sizing equations are derived to determine the main design parameters of the machine. Two-dimensional finite-element analysis (FEA) models are developed to investigate and optimize the machine performance. Furthermore, the flux-weakening capability of the machine is analyzed and further improved by segmental PMs with iron bridges. The machine performance predictions by 2-D FEA models are validated by experimental tests on the prototype machine. The suitability of the proposed outer-rotor PMFS machine for in-wheel light traction application is demonstrated.