With the shift towards electrification, automakers are constantly looking for ways to increase efficiency of the electric vehicles (EVs). Whether through advanced materials, battery technology, powertrain optimization, software optimization, or reliability improvements, these strategies can help improve EV range, performance, and energy efficiency, making EVs a more attractive option for consumers. This paper focuses on powertrain optimization by utilizing a two-speed transmission instead of a conventional single-speed solution. Multi-speed transmissions offer faster acceleration, increased speed, better gradeability, and reduced energy consumption, which translates to increased vehicle range. Cost and space are critical factors in development and are considered when selecting architecture. The gear ratios are selected by solving an optimization problem to minimize the energy loss and maximize the dynamic performance. The vehicle system-level simulation is set up in the MATLAB/Simulink environment and comprises the electric plant, drivetrain subsystems, and associated control algorithms. Particle Swarm Optimization (PSO) iteratively searches for the optimal solution, ensuring the motor and the inverter operate in the most efficient region during the selected drive cycle. The present architecture considers a three-plane or 3-stage with a 2-speed design. Stages 1 & 3 incorporate compound offset gearing with the 3rd stage connecting to the differential. The shiftable 2nd stage is proposed as a planetary gearset with a sun connection to the 1st stage and carrier connection to the 3rd stage. The planetary ring member can be fixed or released in case of 1st speed or 2nd speed respectively. The ring member release can also support free-wheel conditions in the case of all-wheel drive (AWD) vehicles in one-axle drive mode. Bi-stable electromagnetic clutches are used instead of conventional frictional clutches, making it a compact and efficient solution. Software control is used to optimize the handshake between clutches to facilitate the feel of a power shift. The initial findings suggest that by incorporating a multispeed transmission, the main motor in an electric vehicle can be downsized to half its power while maintaining two-thirds of its torque. Simulation suggests an increase of 52% in overall efficiency for such a configuration.