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This paper deals with the design of permanent magnet synchronous motors (PMSMs) with ferrite magnets and their comparison with synchronous machines with NdFeB magnets. In recent years, ferrite magnets have become popular due to their rather low cost and, what is more important, due to increasing of the NdFeB magnets cost last time. The progress in ferrite magnet material properties during the latest decade gave rise to their use in high power applications. Their remanent flux density today reaches values beyond 0.4 T, which allows design electrical machines with acceptable performance. In this paper, three designs of ferrite machines are presented and compared with a real PMSM with NdFeB magnets. Furthermore, the influence of the stator winding type and the shape of the slot opening on the PMSM properties will be demonstrated. All machines are designed for the same output power as the original PMSM with NdFeB magnets. This paper demonstrates that ferrite magnets can, to some extent, be used as replacements for the NdFeB magnets in high-efficiency power applications.