Electric Vehicle Battery - Global Market Outlook (2021 - 2028)

Electric Vehicle Battery - Global Market Outlook (2021 - 2028)

According to Stratistics MRC, the Global Electric Vehicle Battery Market is accounted for $27.30 billion in 2021 and is expected to reach $157.94 billion by 2028 growing at a CAGR of 28.5% during the forecast period. Battery is used as a secondary power source in automobiles. An electric vehicle battery is a secondary (rechargeable) battery. It uses chemical energy stored in rechargeable battery packs for power and therefore does not require any combustion engine for propulsion. An electric vehicle battery or traction battery powers the propulsion of battery electric vehicles. The emergence of Lithium-ion technology has fueled the growth rate for batteries over the last two decades. While initial hybrid vehicles used Nickel Metal Hydride (NiMH) batteries, Li-ion batteries have been the primary solutions for automakers to power plug-in hybrid electric vehicles (PHEVs) and battery electric vehicles (BEVs). High-energy density, charge retention capacity, and low maintenance are some of the benefits that have accelerated the growth of Li-ion as a battery technology. Automobile manufacturers introducing BEVs and PHEVs in the EV battery market are further enhancing the technology and are anticipated to offer Li-ion powered solutions as a primary power source in vehicles.

Market Dynamics:

Driver:

Development of the battery-as-a-service model (BaaS)

The BaaS model enables EV owners to rent battery services monthly instead of buying a battery with the EV. The model has two major advantages: consumers can save money on battery cost, and they do not have to worry about battery depreciation. Such models benefit both, consumers and manufacturers, as manufacturers can accurately predict the market size and potential by tying up with companies providing battery-as-a-service models. Companies are coming up with business models like battery swapping and battery-as-a-service (BaaS) that allow users to change/swap EV batteries once discharged. This saves users the time spent on recharging the batteries, thereby improving customer satisfaction and addressing one of the main reasons consumers refrain from opting for EVs. Several Chinese EV battery manufacturers, such as NIO, follow the BaaS model that de-couples the battery from the EV.

Restraint:

Reduction in subsidies

The purchase subsidies were reduced in key markets, such as France and China. For instance, the Chinese Ministry of Finance announced plans to cut down on subsidies associated with electric cars by about half in 2019, 20% in 2021, and 30% by 2022. However, vehicles for public transport and those costing below USD 42,000 would continue to receive subsidies, with the new ruling only hitting luxury car brands. Since the Chinese Ministry of Finance only provides subsidies for cars with a high battery capacity, EV battery manufacturers have to either provide car manufacturers with high-capacity batteries or reduce battery prices to ensure the overall cost of a vehicle falls under the subsidized range. Though this is done to boost local manufacturing, EV battery manufacturers may struggle as they would need to improve battery capacity to receive more subsidies while keeping the price of the battery low.

Opportunity:

Launching of new plug-in models

Electric vehicle market is witnessing exponential growth across geographies. Thus, major automobile manufacturers are entering the EV market due to the growing demand for EVs. Several major automakers such as Mercedes-Benz, Toyota, Tata Motors, and Hyundai are working on EV models to expand their position in the automotive industry. With major automakers taking an interest in the EV space, developments in electric vehicles are expected to increase in the near future. Some of the other factors influencing automobile manufacturers to enter the EV market include the existing major players in conventional vehicles having sufficient experience in other aspects of vehicles, like aesthetics and comfort that might otherwise be overlooked.

Threat:

Battery safety concerns

EV batteries consist of various inflammable materials such as lithium, manganese, and plastics. Lithium is also highly reactive when exposed to water. Most of the electric vehicle batteries are considered safe as they undergo various tests before being put into use. However, there have been incidents such as the recall of 68,000 Chevy EV Bolts after five fire incidents related to batteries that have raised doubts on the safety of these batteries. Thus, there are concerns over the performance and safety of these batteries in hot or waterlogged environments. According to the National Fire Protection Association (NFPA) of the US, most EV fires in the country from 2013-2017 resulted from battery power systems. The association also stated that major reasons for the EV battery fire were heavy temperature fluctuations, heavy rain, and overcharging. Thus, poses threat for the market growth.

The lithium-ion battery segment is expected to be the largest during the forecast period

The lithium-ion battery segment is estimated to have a lucrative growth. Lithium-ion batteries have traditionally been used mainly in consumer electronic devices, such as mobile phones and PCs, but are increasingly being redesigned for use as the power source of choice in hybrid and the complete electric vehicle (EV) range, owing to factors, such as low environmental impact, as EV does not emit any CO2, nitrogen oxides, or any other greenhouse gases. The emergence of new and exciting markets via electric vehicles for both personal and commercial vehicle applications is projected to drive the demand for lithium-ion batteries across the globe. Furthermore, lithium-ion batteries have several merits over other batteries (i.e., valve-regulated lead-acid), which make it preferable to be used in data centers.

The passenger car segment is expected to have the highest CAGR during the forecast period

The passenger car segment is anticipated to witness the fastest CAGR growth during the forecast period owing to the shift of emerging region’s cell suppliers from lithium to cobalt bearing NCM cathodes. In the United States, the federal aim is for EVs to make up 50% of new passenger cars sold by 2030. At the same time, a number of individual states have announced more ambitious targets. Panasonic, one of the major suppliers of batteries to OEMs like Tesla and Toyota, has deployed more lithium batteries in 2019 than all of its competitors globally.

Region with highest share:

North America is projected to hold the largest market share during the forecast period. The North American region is one of the leading consumers of batteries, the integration of renewables with energy storage systems is offering a market growth opportunity for the lithium-ion (Li-ion) battery market. Moreover, the U.S.-based OEMs are concentrating on eliminating the supply chain risks and the concerns regarding battery sourcing from a single region such as China. For example, establishing nearby manufacturing plants such as the Gigafactory 1 in Nevada operated by Tesla in collaboration with Panasonic would allow the co-development of battery cells and packs, as well as the swift troubleshooting of issues related to these components.

Region with highest CAGR:

Europe is projected to have the highest CAGR over the forecast period. The growth of the EV battery market in the region is largely dependent on government incentives and funds as electric vehicles are currently very expensive. Countries such as France, Germany, Spain, UK, Italy, Norway, Sweden, and Denmark are considered under Europe for market analysis. The presence of OEMs such as VDL Groep (Netherlands) and AB Volvo (Sweden) offers opportunities for the growth of the EV battery market in the region. The initiatives undertaken by the French government to promote electric commercial vehicles and electrification of public transport fleets are driving the country’s EV battery market. The government in Germany is also focusing on increasing the use of electric vehicles. Moreover, the increasingly stringent regulations related to environmental issues are propelling market players to test and develop advanced vehicles, which will further boost the market for advanced battery technologies.

Key players in the market

Some of the key players profiled in the Electric Vehicle Battery Market include BYD Company Limited, Contemporary Amperex Technology Co Ltd, Crown Battery Corporation, East Penn Manufacturing Company, GS Yuasa Corporation, Hitachi Chemical Company, Johnson Controls International, LG Chem Ltd, Narada Power Source, Panasonic Corporation, Quallion, Samsung SDI Co Ltd, and Tianneng Power International.

Key Developments:

In March 2021, General Motors partnered with SolidEnergy Systems, a lithium metal battery startup. This partnership aimed to boost the U.S. automobile manufacturer’s battery development, allowing for high EV driving range in a smaller package.

In July 2020, LG Chem declared that it would reuse and recycle its used batteries proactively. LG Chem would research and develop technologies to predict the remaining life by collecting the batteries supplied to customers.

In March 2020, BYD announced the launch of a blade battery system, which consists of thin individual batteries. The thickness of a single battery is around 1.35 cm and occupies 50% less space than earlier products.

Power Sources Covered:
On Board Electric Generator
Stored Electricity

Li-ion Battery Components Covered:
Positive Electrode
Negative Electrode
Electrolyte
Separator

Propulsion Types Covered:
Battery Electric Vehicle (BEV)
Hybrid Electric Vehicle (HEV)
Plug-In Electric Vehicles
Plug-In Hybrid Electric Vehicle (PHEV)
Fuel Cell Electric Vehicles (FCEV)

Powertrains Covered:
Combined Hybrid Electric Vehicle
Parallel Hybrid Electric Vehicle
Series Hybrid Electric Vehicle

Vehicle Types Covered:
Two Wheeler
Passenger Car
Commercial Vehicle
Vans
Medium & Heavy Trucks
Buses
Off-highway Vehicles
Other Vehicle Types (Golf Cart)

Battery Capacities Covered:
Less Than 20 kWh
21-40 kWh
More Than 41 kWh

Voltage Types Covered:
12 Volt
14 Volt
24 Volt
48+ Volt

Types Covered:
Lead-Acid Battery
Lithium-Ion Battery
Nickel Metal Hydride Battery
Sodium-Ion
Zebra Batteries
Ultra Capacitors Batteries
Metal Air Batteries

Methods Covered:
Wire Bonding
Laser Bonding

Battery Forms Covered:
Prismatic
Cylindrical
Pouch

Material Types Covered:
Cobalt
Manganese
Natural Graphite

End Users Covered:
Aftermarket
Original Equipment Manufacturers (OEM)

Regions Covered:
North America
US
Canada
Mexico
Europe
Germany
UK
Italy
France
Spain
Rest of Europe
Asia Pacific
Japan
China
India
Australia
New Zealand
South Korea
Rest of Asia Pacific
South America
Argentina
Brazil
Chile
Rest of South America
Middle East & Africa
Saudi Arabia
UAE
Qatar
South Africa
Rest of Middle East & Africa

What our report offers:
- Market share assessments for the regional and country-level segments
- Strategic recommendations for the new entrants
- Covers Market data for the years 2020, 2021, 2022, 2025, and 2028
- Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
- Strategic recommendations in key business segments based on the market estimations
- Competitive landscaping mapping the key common trends
- Company profiling with detailed strategies, financials, and recent developments
- Supply chain trends mapping the latest technological advancements

Free Customization Offerings:
All the customers of this report will be entitled to receive one of the following free customization options:
Company Profiling
Comprehensive profiling of additional market players (up to 3)
SWOT Analysis of key players (up to 3)
Regional Segmentation
Market estimations, Forecasts and CAGR of any prominent country as per the client's interest (Note: Depends on feasibility check)
Competitive Benchmarking
Benchmarking of key players based on product portfolio, geographical presence, and strategic alliances