Automotive Lithium-Ion Battery Market To Generate Revenue Worth USD 55.6 Billion by 2030
- Published: October 2023
The global automotive lithium-ion battery market is expected to be valued at USD 55.6 billion by 2030, advancing at a CAGR of 16.8% during the expected period (2024–2030). This can be ascribed to the increasing sales of electric vehicles globally, due to the rising government support in terms of subsidies and monetary benefits for the adoption of EVs; and the surging deployment of such batteries in several industries, such as medical, aerospace & defense, energy storage, electronics, and data communication & telecom. From 2017 to 2022, EV sales jumped from around 1 million to more than 10 million.
Moreover, the choices of people are shifting toward using more alternative energy vehicles, mainly electric vehicles, due to the increasing pollution levels from conventional vehicles, and rapidly declining prices of lithium-ion batteries, which, in turn, support the growth of the market.
APAC Is the Market Leader
Regionally, APAC is the largest market for lithium-ion batteries. This is ascribed to the high production and sales of electric vehicles and the presence of several local and international industry players in the region. In APAC, China is the leading market, as with a vast population, the demand for passenger vehicles increases, within which the use of electric vehicles is on the rise. This is due to aid given by government authorities, such as providing infrastructural support including charging station spaces, offering incentives and subsidies, and pouring large amounts of money into the electric vehicle and battery sectors.
Whereas, the European market is projected to observe the fastest growth during the expected period. This can be due to the goal set by regional governments to raise the sales of electric vehicles and the presence of major automobile companies in the region. As mentioned by the International Energy Agency, the European Union adopted new CO2 standards for cars and vans in March 2023, which require a 55% and 50% reduction in emissions of new cars and vans by 2030 (compared to 2021), and 100% for both by 2035. Moreover, the European Union has organized its combined efforts with battery manufacturers and commercial lenders to build an ecosystem with large investments to become self-sufficient in the production of batteries, to meet the surging requirement for powering electric vehicles. For instance, the European Investment Bank (EIB) provided primary approval for a $392.0 million loan to Northvolt Ett, to set up a battery Gigafactory in Sweden.
Fully Electric Vehicle Dominates the Market
The fully electric category accounts for the largest revenue share in the industry. This is ascribed to surging demand in fully electric vehicles such as BEVs and the high average battery capacity in fully electric cars. For instance, the average battery capacity in fully electric cars was over 40 kWh in the U.S. in 2018. Additionally, the increasing concerns over environmental protection are encouraging governments in various countries to offer subsidies and incentives for rapid production and adoption of BEVs.
Based on battery type, the lithium-nickel-manganese-cobalt category is expected to witness significant growth in the coming years. This can be ascribed to the rising utilization of NMC batteries in electric cars for escalated effectiveness, the declining prices of these batteries, and they provide a greater energy bulk and thus offer a higher traveling range.
Some of the leading players operating in the market are Contemporary Amperex Technology Co. Ltd. (CATL), LG Energy Solution Ltd., BYD Motors, Inc., Panasonic Industry Co., Ltd., Samsung SDI Co. Ltd., Toshiba Corporation, OptimumNano Energy Co. Ltd., Tesla Inc., Shenzhen BAK Battery Co. Ltd., and GS Yuasa International Ltd.