| Published | Report Code | Available Format | Pages |
|---|---|---|---|
| October 2019 | AT11757 | 200 |
Valued at $24.2 billion in 2018, the global automotive lithium-ion battery market is projected to surpass $74.3 billion by 2024, witnessing a CAGR of 15.9% between 2019 and 2024.
Among all the regions, the market is expected to witness the fastest growth in Europe, during the forecast period. This can mainly be attributed to the rapidly growing electric vehicle (EV) sales in the region. The presence of active associations in the European region, such as Association of European Automotive Industrial Battery Manufacturers, is supporting the use of lithium ion battery in the automobile industry. Major manufacturers such as BMW AG, and Volkswagen Group are present in Europe, and are investing in advance technologies for their EVs, which is acting as a growth factor for European automotive lithium-ion battery market.
Factors Governing Automotive Lithium-Ion Battery Market
The key trend observed in automotive lithium-ion battery market is the increasing usage of NMC batteries in electric cars globally. It is mainly due to rapidly growing demand of passenger cars with high ranges, as NMC battery provides greater energy density. Additionally, prices of these batteries have come down to an average of $200 per kWh in 2018. Moreover, NMC batteries are much lighter and require lesser space than other majorly used batteries.
Over the past years, demand for EVs has grown rapidly in various countries. According to the International Energy Agency (IEA), the global electric car fleet exceeded over 5.1 million in 2018 up 2.0 million in previous year. Furthermore, issues such as environment pollution and highly fluctuating oil prices, continue to push governments and consumers towards alternatives to ICE powered automobiles. government across various geographies are encouraging consumers to adopt EVs by offering various monetary benefits on purchase of EVs, which further proves to be a major growth factor for the automotive lithium-ion battery market.
Several emerging economies globally have announced targets to adopt EVs in the near future, creating ample growth opportunities for the EVs as well as its battery manufacturers. Some of these countries have announced targets to increase proportion of EVs in new car sales. For instance, in May 2019, India announced to sell only electric two-wheelers from 2025, and electric three-wheelers from 2023. South Africa is targeting for 20% share of electric cars in total car fleet, by 2030. Mexico set target to sell only zero emission vehicles (ZEVs); 5.0% of new vehicle sales by 2030, and 50.0% sales by 2040. These set targets and policies to increase adoption rates in developing countries are expected to create huge opportunities for automotive lithium-ion battery market players in coming years.
Structural Analysis of Automotive Lithium-Ion Battery Market
On the basis of battery type, automotive lithium-ion battery market was dominated by LFP battery category in terms of value. It is mainly ascribed to the usage of LFP batteries by the Chinese EV manufacturers, which holds majority of market share worldwide, in electric car and electric buses.
Within vehicle type, the passenger car category held the largest share in the automotive lithium-ion battery market. The sales were driven by heavy push from governments in major automobile selling countries, such as China and the U.S., for the production of electric cars. Additionally, huge monetary incentives are being provided to both passenger car manufacturers and end-users, which is proving to be a major growth driver for passenger cars category.
In terms of technology, the battery electric vehicles (BEVs) category possessed dominating share in value terms, in the automotive lithium-ion battery market. It is majorly due to highest average battery capacity installed in BEVs as compared to plug-in hybrid (PHEVs) and hybrid electric vehicles (HEVs). Concerns over environmental protection from vehicle’s pollution makes BEVs more favourable. Additionally, subsidies on production and incentives on purchase of BEVs are higher than PHEVs and HEVs.
Based on structural design, the cylindrical lithium-ion batteries are expected to witness fastest growth rate during the forecast period. Cylindrical cells have higher heat dissipation rate during charging and discharging of the cells, and these cells incur lower cost to the manufacturers of EVs. Due to these benefits, cylindrical batteries are being used by leading EV manufactures in new electric vehicles.
Geographical Scenario of Automotive Lithium-Ion Battery Market
Globally, APAC was the largest market for automotive lithium-ion batteries, during the historical period and is expected to maintain the same trend during the forecast period. This can be mainly attributed to the increased adoption of EVs in China. The exhaustive support of government has helped the market to grow in the country during the historical period.
During the forecast period, the automotive lithium-ion battery market is expected to witness the fastest growth in Europe, mainly on account of rapidly growing sales of electric cars and increasing investment in R&D activity of EVs manufacturers of the region.
Competitive Landscape of Automotive Lithium-Ion Battery Market
Automotive lithium-ion battery market is mainly dominated by battery manufacturers of APAC region, as the leading battery producers are present in China, Japan, and South Korea currently. Some of these leading manufactures are Contemporary Amperex Technology Co. Ltd. (CATL), LG Chem Ltd., BYD Co. Ltd., Panasonic Corp., and Samsung SDI Co. Ltd.
Some of other major manufacturers of automotive lithium-ion battery worldwide are Automotive Energy Supply Corp. (AESC), OptimumNano Energy Co. Ltd., Tianjin Lishen Battery Joint-Stock Co. Ltd., Tesla Inc., and Shenzhen BAK Battery Co. Ltd.
Recent Strategic Developments of Major Automotive Lithium-Ion Battery Players
In recent years, majority of the battery manufacturers in automotive lithium-ion battery market have focused mostly upon facility expansion for more production of lithium-ion batteries and collaborations with EV manufacturers. For instance, in July 2019, Toyota Motor Corp. formed a strategic partnership for new energy vehicle battery with Contemporary Amperex Technology Co. Ltd. (CATL). This partnership includes joint developments and recycling apart from the supply of lithium-ion cells. Through this partnership, CATL will combine its battery development and supply capabilities with EVs and battery development technologies of Toyota for the development of electrified vehicles for the consumers.
Similarly, in Jan 2019, LG Chem Ltd. announced an investment of around $1 billion on new battery-production capacity in the eastern city of Nanjing, China. With this investment, the company has started tapping demand for batteries in China and globally, for deployment in renewable energy cars and power plants. The company invested $1.07 billion into the new Nanjing complex, about half of which will go for EVs and small battery production.
Key Questions Answered in the Report
