Lithium-ion Battery Market Size & Share Analysis- Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

Lithium-ion Battery Market Trends & Growth Drivers

Declining Costs and Innovation in Manufacturing Are Major Trends

• The increasing activities across the manufacturing landscape are leading to a greater demand for Li-ion cells and battery packs. Planners, regulators, policymakers, and investors are taking several measures to cover most of the demand by focusing on electric mobility and the usage of lithium, which will lower the cost of these products and change the dynamics of the market. Additionally, many automotive companies are investing heavily in pack assembly, which is leading battery makers to offer more-aggressive prices and enter the stationary storage segment to diversify their revenue streams.
• Innovation is a critical component of cost reduction for Li-ion batteries. Advancements in electrolytes and anode materials, as well as the emergence of battery recycling processes, are the key developments. The Li-ion cell requires robust materials to achieve a high energy density, long life, and high charging/discharging power.
• Most manufacturers anticipate the life of lithium-ion batteries to be 5 years, or 2,000 charging cycles. However, lithium-ion batteries can operate for up to 3,000 cycles if they are handled with care and utilized properly.

High Adoption of Li-Ion Batteries in Consumer Electronics Is Key Driver

• The expanding middle-class population, changing lifestyle preferences, inclination to use smart electronic devices are the main factors supporting the high demand for lithium-ion batteries for consumer electronic products. Additionally, governments around the world are increasingly supporting digitalization, and promoting the usage of various electronic devices, while telecom companies are working on 5G for better connectivity.
• Li-ion batteries have higher specific energy and power density relative to other battery technologies.
• Companies are designing Li-ion batteries particularly for 5G telecom sites, providing a wide range of charging voltages, long life, fast charging, and intelligent management.
• The rapidly advancing internet of things (IoT) technology will connect almost every electrical device to the internet in a few years. As many of these devices will use Li-ion batteries as a power source, the market will offer plenty of growth opportunities.
• The extensive adoption of AI is going to introduce a countless number of electrical devices, which is expected to ramp up the market growth rate further.

Development of New Battery Technologies Is Major Restraint

• There are a number of new battery technologies currently in the research and development (R&D) stage, including hydrogen fuel cells, vanadium flow batteries, zinc–bromine batteries, and aluminum–air batteries. They have worked in small-scale and niche applications in studies, but are not fully commercialized and have not reached economic viability yet.
• Moreover, specific to electric vehicles, hydrogen fuel cells create a long-term threat to lithium-ion batteries. Hydrogen fuel cells have key advantages, such as higher capacity, quick refueling at a hydrogen filling station in around 3–5 minutes, and no need for recharging. But, as of now, hydrogen fuel cannot be used as an energy source for mobility purposes because hydrogen compounds are unstable at atmospheric temperature. Therefore, this technology will take some time to find usage as a mobile energy source.
• In grid storage applications, the low performance of lithium-ion batteries and the presence of other low-cost technologies present a threat to the market. Vanadium flow batteries have a good response time, which makes them a suitable option for commercial and grid applications. Further, these batteries have an excellent lifespan and require minor maintenance.
• Companies are investing heavily in R&D of other technologies to make them a viable option over lithium-ion batteries, which, over the long term, could further hamper the lithium-ion battery market advance around the world.

Li-Ion Battery Industry Outlook

Type Insights

• The Li-NMC category is projected to grow at the highest CAGR, of 16.0%, during 2024–2030, as well hold the largest market share. This variant is popular owing to its high energy density, good stability, and long discharge cycle. This is due to the usage of an optimal amount of nickel, manganese, and cobalt. These characteristics make Li-NCM variants ideal for laptops, mobile phones, tablets, and power tools.
• Li-NMC batteries are employed in hybrid electric vehicles (HEVs), battery electric vehicles (BEVs), and plug-in hybrid electric vehicles (PHEVs) to address safety concerns with regard to battery overheating.
• The current focus of NMC cathode designers and researchers to reduce the cobalt content, which, in turn, will make the battery cheaper and strengthen the market in this category in the coming years.

During the study, we have analyzed the following types in the report:

• Lithium–Nickel–Manganese–Cobalt (Li-NMC) (Largest and Fastest-Growing Category)
• Lithium–Iron Phosphate (LFP)
• Lithium–Cobalt Oxide (LCO)
• Lithium–Manganese Oxide (LMO)
• Lithium–Nickel–Cobalt–Aluminum Oxide (NCA)

Capacity Analysis

• The 10,001–60,000 mAh category held the largest market share, of 45%, in 2023. This is because lithium-ion batteries with a capacity of 10,001–60,000 mAh are used for applications requiring a high capacity, such as BEVs/PHEVs, material handling equipment, marine systems, robots, industrial equipment, telecommunication systems, electronic cash registers, standby power supply systems, golf carts, smart grids, and aviation systems.

Below are the capacities covered in the report:

• 0–3,000 mAh
• 3,001–10,000 mAh (Fastest-Growing Category)
• 10,001–60,000 mAh (Largest Category)
• More than 60,000 mAh

Application Insights

• Based on application, the automotive category accounted for the largest share, of 30% in 2023, and it is projected to have a CAGR of 16.2% during the forecast period. The increasing focus of the major developing countries to reduce carbon emissions and shift from conventional ICE vehicles to electric variants are the major factors driving the demand for lithium-ion batteries in the automotive sector.
• The dramatic fall in lithium-ion batteries price is expected to reduce the purchase cost of EVs, making them a more-viable option for consumers. Presently, China is the largest market for EVs, and it will also lead the market in the coming years, driven by government subsidies and purchasing quotas in big cities.

The following applications are included in the report:

• Consumer Electronics
  • Smartphones
  • Uninterruptible power supply (UPS) systems
  • Laptops
  • Others (games, gardening tools, and drills)
• Automotive (Largest and Fastest-Growing Category)
  • Battery electric vehicle (BEV)
  • Plug-in hybrid electric vehicle (PHEV)
  • Hybrid electric vehicle (HEV)
• Aerospace and Defense
• Medical
• Telecom
• Industrial
• Others

APAC Is Largest and Fastest-Growing Region

• Geographically, APAC is the fastest-growing market, advancing at a CAGR of 15.8% during 2024–2030; it also held the largest market share in 2023. The growing sales of portable electronic devices and EVs are driving the lithium-ion battery market in the region.
• Portable electronic devices, such as smartphones, tablets, gaming systems, and personal computers (PCs), are highly demanded in India, China, and South Korea.
• The region has some of the major lithium mining areas. With around 55,000 metric tons of lithium mined in 2021, Australia is the top producer in the world. With 26,000 and 14,000 metric tons of lithium produced, Chile and China were the second and third, respectively.
• China is the largest consumer of lithium due to its huge electronics and EV industries. Additionally, it controls the majority of the world's lithium processing facilities and manufactures more than three-quarters of the lithium-ion batteries used worldwide. Although China presently imports the majority of its lithium from Australia, it plans to increase its production.
• The adoption of EVs in China, India, South Korea, and Japan has a positive impact on the lithium-ion battery market of the APAC region. These countries offer incentives and subsidies to the manufacturers as well as buyers of electric vehicles, to encourage their sales. For instance, the Chinese government provides subsidies to the local manufacturers of lithium-ion batteries, to reduce the prices of EVs in the country.
• China is the largest producer of electric vehicles, and it will also lead the industry in terms of demand in the coming years, driven by government subsidies. These factors drive the demand for such batteries in the nation.

The regions and countries analyzed in this report include:

• North America
  • U.S. (Larger and Faster-Growing Country Market)
  • Canada
• Europe
  • Germany (Largest Country Market)
  • U.K. (Fastest-Growing Country Market)
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia-Pacific (APAC) ((Largest and Fastest-Growing Regional Market)
  • China (Largest Country Market)
  • Japan
  • India (Fastest-Growing Country Market)
  • South Korea
  • Australia
  • Rest of APAC
• Latin America (LATAM)
  • Brazil (Largest and Fastest-Growing Country Market)
  • Mexico
  • Rest of LATAM
• Middle East and Africa (MEA)
  • Saudi Arabia (Largest Country Market)
  • South Africa
  • U.A.E. (Fastest-Growing Country Market)
  • Rest of MEA

Lithium-Ion Battery Market Share

The global lithium-ion battery industry is fragmented with the presence of several key players. A large number of manufacturers are based in APAC countries, such as China, Japan, and South Korea. These companies have pre-defined relationships with customers for the supply of these energy storage systems in high volumes for cars, trucks, buses, consumer electronics, and other devices. Additionally, nearly all of the companies have leveraged economies of scale to lower battery production costs, improve energy densities, and augment performance. Additionally, some companies, including GS Yuasa Corporation, Samsung SDI Co. Ltd., and LG Chem Ltd., are expected to ramp up production amid the falling production costs in the foreseeable future.

Lithium-ion Battery Industry News

• In January 2022, Toshiba Corporation launched 20-Ah-HP SCiB, a rechargeable lithium-ion battery cell that can deliver high energy and high power. It can be used in various applications, such as the rapid charging of commercial vehicles, regenerative power systems for rolling stock, and industrial equipment.
• In December 2021, Contemporary Amperex Technology Co. Ltd. and Eaton partnered for Contemporary Amperex Technology to provide its backup source solutions for UPS lithium-ion batteries for business-level applications. In return, Eaton facilitates energy-efficient products and solutions for ATL projects.
• In December 2021, Li-Cycle, LG Chem Ltd., and LG Energy Solution came to an agreement as per which LG Energy Solution supplies Li-Cycle with battery manufacturing scrap and lithium-ion batteries for recycling. Further, Li-Cycle recycles the battery materials from LG Energy Solution and will supply LG Chem Ltd. and LG Energy Solution with 20,000 tons of nickel in years to come.
• In October 2021, Contemporary Amperex Technology Co. Ltd. expanded its manufacturing facility for lithium-ion battery production in China.