Permanent magnet vernier machines have considerable potential for low-speed direct-drive applications because of the high torque density at low speed. However, according to the theory of motor winding, concentrated windings have no weakening effect on higher odd-order harmonics, which leads to the result that the torque ripple of the vernier machine with concentrated windings is higher than that with distributed windings. Besides, due to the different permeance of iron and permanent magnets, the air gap flux density under consequent poles is asymmetric, which introduces even-order harmonics and thus makes phase back-EMF asymmetric. In this paper, the flux distribution, the back-EMF and torque characteristics of the permanent magnet vernier machine with concentrated windings are investigated with theoretical analysis and finite element analysis (FEA). The influence of several parameters of flux modulation poles (FMPs) are discussed to find the optimal coefficient combination, which aims to weaken higher odd-order harmonics. Furthermore, the effect of the rotor with axial segmentation is analyzed, which is utilized to reduce even-order harmonics in the back-EMF. FEA indicates that the proper FMP parameter selection and the axially segmented rotor can significantly suppress the higher harmonics and even-order harmonics in the back-EMF.