Automotive Lithium-Ion Battery Market Research Report: By Vehicle Type (Two-Wheeler, Passenger Car, Commercial Vehicle), Battery Type (Lithium-Iron Phosphate, Lithium-Manganese Oxide, Lithium-Nickel-Manganese-Cobalt, Lithium Titanate Oxide, Lithium-Nickel-Cobalt-Aluminum Oxide), Vehicle Technology (Hybrid, Plug-in Hybrid, Fully Electric), Structural Design (Cylindrical, Prismatic, Pouch), Geographical Outlook (U.S., Canada, Germany, France, U.K., Norway, Sweden, Netherlands, China, Japan, South Korea, India, Mexico, Brazil) – Global Trends Analysis and Growth Forecast to 2024

Market Outlook

The automotive lithium-ion battery market revenue stood at $24.2 billion in 2018, and it is expected to cross $74.3 billion by 2024, advancing at a CAGR of 15.9% during 2019–2024.

The European market for automotive lithium-ion batteries will record the fastest growth in the coming years owing to the rapid adoption of electric vehicles (EVs) in the region. Moreover, the increasing support from associations such as the Association of European Automotive Industrial Battery Manufacturers is supporting the adoption of lithium-ion batteries in the automotive industry. Leading automakers, such as Volkswagen Group and BMW AG, are heavily investing in advanced technologies for their EVs.

Trends & Drivers

The rising installation of nickel–manganese–cobalt oxide (NMC) batteries in electric cars is a major trend in the automotive lithium-ion battery industry. The burgeoning demand for passenger cars with a long driving range has boosted the adoption of NMC batteries owing to their greater energy density. Moreover, the low prices, lesser space requirement, and low weight of these batteries have resulted in their surging popularity. In 2018, the prices of NMC batteries came down to an average of $200 per kilowatt-hour (kWh).

The automotive lithium-ion battery market growth is primarily driven by the burgeoning adoption of EVs. According to the International Energy Agency (IEA), the total number of electric cars in operation grew by 2.0 million from 2017 to reach 5.1 million in 2018. Governments and customers are shifting toward EVs due to the growing pollution and fluctuating gasoline (petrol) and diesel prices. Governments across the world are offering several monetary benefits on the purchase of EVs to promote their adoption.

Several developing countries have set up targets to adopt EVs in the immediate future, thereby creating ample growth opportunities for the manufacturers of EVs and batteries. For example, in May 2019, India announced its plan to sell only electric three-wheelers from 2023 and electric two-wheelers from 2025 onward. Similarly, South Africa targets the incorporation of 20% electric cars in its car fleet by 2030, while Mexico has a target to sell only zero-emission vehicles (ZEVs); 5% of the new automobile sales by 2030 and 50% sales by 2040 must be of ZEVs in the nation.

Segmentation Analysis

The lithium–iron phosphate (LFP) category, within the battery type segment, dominated the market, in terms of value, in 2018. It can be attributed to the increasing usage of LFP batteries by the electric bus and electric car manufacturers of China.

In the automotive lithium-ion battery market, the passenger car category accounted for the largest share within the vehicle type segment during 2014–2018. This can be ascribed to the extensive government support for electric car production and adoption in the U.S. and China. In this regard, the huge monetary incentives being offered to the buyers and manufacturers of passenger cars are supporting the growth of this category.

In 2018, the fully electric category, under the vehicle technology segment, held a prominent share, in terms of value. It is attributed to the higher average capacity of the batteries installed in fully electric vehicles as compared to those in hybrid electric vehicles (HEVs) and plug-in hybrid vehicles (PHEVs). The high concerns regarding environmental pollution have supported the adoption of fully electric automobiles. Additionally, the higher subsidies and incentives offered on the production and purchase of battery electric vehicles (BEVs) in comparison to HEVs and PHEVs have fueled the demand for these vehicles.

The cylindrical category will witness the fastest growth in the near future, under the structural design segment. The growing adoption of cylindrical cells can be credited to their faster heat loss during charging and discharging and their lower cost.

Geographical Outlook

The Asia-Pacific (APAC) automotive lithium-ion battery market generated the highest revenue in the past, and it is expected to continue its dominance during 2019–2024. This can be owed to the vast demand for EVs in China owing to the favorable government policies supporting their production and adoption.

Moreover, the European region will showcase the fastest growth in the near future due to the rapidly rising sales of electric cars and hefty investments in research and development by regional EV manufacturers.

Competitive Landscape

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

• What is the current scenario of the automotive lithium-ion battery market?
• What are the emerging technologies in the market?
• What is the demand of lithium-ion battery in various vehicle types (scooters, motorcycles, cars, trucks, buses etc.)?
• What are the regulatory policies in different geographies?
• What is total production and demand of automotive lithium-ion batteries?
• What is the historical and the present size of the market segments and their future potential?
• What are the major catalysts for the market and their impact during the short, medium, and long terms?
• What are the evolving opportunities for the players in the market?
• Which are the key geographies from the investment perspective?
• What are the key strategies adopted by the major players to expand their market share?