Electric Vehicle (EV) Battery Market to Grow by USD 65.23 Billion (2024-2028), Driven by Rising EV Demand, with AI Powering Market Evolution - Technavio

NEW YORK, Nov. 28, 2024 /PRNewswire/ -- Report on how AI is driving market transformation - The global electric vehicle (EV) battery market size is estimated to grow by USD 65.23 billion from 2024-2028, according to Technavio. The market is estimated to grow at a CAGR of over 20.2%  during the forecast period. Increasing demand for EVS and their expanded applications is driving market growth, with a trend towards increasing use of software and sensors for intelligent BM.   However, growing global power crisis  poses a challenge. Key market players include A123 Systems LLC, Ballard Power Systems Inc., BYD Co. Ltd., CLARIOS LLC, Crown Battery Manufacturing Co., Cummins Inc., East Penn Manufacturing Co. Inc., EnerSys, Enertech International Inc., Envision Group, Exide Industries Ltd., GS Yuasa International Ltd., Hitachi Ltd., LG Chem Ltd., OptimumNano Energy Co. Ltd., Panasonic Holdings Corp., Samsung SDI Co. Ltd., SK Innovation Co. Ltd., Solid Power Inc., Tianneng Group, and Zhejiang Narada Power Source Co. Ltd..

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Market Driver

The Electric Vehicle (EV) battery market is experiencing significant growth as automakers invest heavily in EV technology. Lithium-ion batteries remain the dominant battery technology, with companies like QuantumScape and Solid Power developing solid-state batteries for improved battery life, charging times, and driving ranges. EV sales continue to rise, with electric cars, SUVs, PHEVs, BEVs, and EREVs leading the charge. However, the supply chain for lithium, cobalt, and nickel, used in battery manufacturing, faces challenges due to mining and refining processes. This, in turn, impacts battery prices. Lithium Iron Phosphate batteries and other battery chemistries, including sodium-ion batteries, are also gaining attention. Manufacturers like Northvolt are expanding manufacturing capacity through gigafactories to meet demand. The shift to EVs raises questions about energy security and the role of alternative technologies like hydrogen vehicles and ethanol vehicles. The EV battery market is an evolving landscape, with battery performance, energy density, and manufacturing capacity key factors shaping its future. 

The Electric Vehicle (EV) and Plug-in Hybrid Electric Vehicle (PHEV) market is witnessing significant growth due to the increasing adoption of advanced features such as GPS, modern power train systems, AC systems, power windows, and display drives. These innovations consume a considerable amount of power, leading to a higher energy demand from EV batteries. As a result, there is a growing need for efficient and optimal battery management systems (BMS) to ensure a longer battery life and reduce frequent charging requirements. The automotive industry is focusing on developing advanced high-end BMS solutions using high-power density lithium-ion batteries. Continuous research and development will drive the growth of the intelligent BMS market in the EV and PHEV segments. 

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 Market Challenges

• The Electric Vehicle (EV) battery market is growing rapidly as automakers shift focus towards sustainable transportation. However, challenges persist in the form of battery life, charging times, and driving ranges. Lithium-ion batteries, currently dominating the EV battery scene, face pressure to improve performance and reduce costs. New technologies like solid-state batteries from QuantumScape and Solid Power are promising solutions. However, the supply chain for batteries relies heavily on lithium, cobalt, and nickel, which require mining and refining. This can impact battery prices and energy security. Automakers like Cadillac are investing in manufacturing innovations like laser bonding to increase manufacturing capacity. The EV sales has led to a demand for Gigawatt hours of batteries annually. As the market evolves, we'll see a mix of BEVs, PHEVs, SUVs, and other EV types. Traditional battery chemistries like Lead acid, Nickel-metal hydride, and Lithium Iron Phosphate will continue to coexist with Lithium-ion segment in the EV technology landscape.
• The Electric Vehicle (EV) battery market is experiencing significant growth due to the increasing global demand for electricity to power EVs. In regions with sufficient power generation, such as Europe, the shift to EVs is reducing crude oil consumption, with EVs accounting for approximately 25% of vehicles on the road and consuming 11% of global power demand. However, challenges arise in developing and underdeveloped countries where power generation does not meet daily consumption needs, limiting EV sales and market growth. Despite these challenges, the EV market's expansion continues to impact the global energy landscape.

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Segment Overview 

This electric vehicle (ev) battery market report extensively covers market segmentation by  

1. Type 
• 1.1 Lithium-ion battery
• 1.2 Lead-acid battery
• 1.3 Others
2. Vehicle Type
• 2.1 Battery electric vehicle
• 2.2 Plug-in hybrid electric vehicle
• 2.3 Hybrid electric vehicle
3. Geography 
• 3.1 APAC
• 3.2 Europe
• 3.3 North America
• 3.4 South America
• 3.5 Middle East and Africa

1.1 Lithium-ion battery-  The lithium-ion battery market for Electric Vehicles (EVs) is projected to expand significantly during the forecast period. Lithium-ion batteries, a type of rechargeable battery, are preferred due to their superior electrochemical performance and capacity. The lithium-ion segment is poised for rapid growth, driven by the increasing demand from the EV industry and the declining prices of battery technology. Lithium-ion batteries are manufactured using various combinations of anode and cathode materials, with lithium-nickel-cobalt-aluminum oxide (NCA), lithium nickel manganese cobalt oxide (NCM), lithium-manganese spinel (LMO), lithium titanate (LTO), and lithium-ion phosphate (LFP) being the most common cathode materials. Each cathode material has distinct characteristics, including safety, cost, and performance. Lithium-ion batteries offer a higher current density, longer power-holding capacity, and longer shelf life than other battery technologies. With mass production and government incentives, the cost of these batteries is expected to decrease significantly, further fueling demand. Lithium-ion batteries are available in cylindrical, prismatic, and laminate shapes, and the choice of cell shape depends on end-user requirements. Companies such as Panasonic Corporation, Samsung SDI CO., LTD., and LG Chem offer cylindrical, laminate, and prismatic lithium-ion cells, respectively. Compared to other battery chemistries like lead-acid and NiMH batteries, lithium-ion batteries do not have their drawbacks, making them the preferred choice for EVs. As a result, the demand for lithium-ion batteries for EVs is expected to continue to rise, driving the growth of the market during the forecast period.

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Research Analysis

Electric Vehicles (EVs) are revolutionizing the automotive industry with their eco-friendly and cost-effective advantages. The heart of an EV is its battery, which powers the motor and determines key factors such as driving range, charging times, and battery life. Lithium-ion batteries currently dominate the EV battery market due to their high energy density, long cycle life, and fast charging capabilities. However, solid-state batteries are emerging as a promising alternative, offering even greater energy density and faster charging times. Automakers worldwide are investing heavily in EV technology, with Battery Electric Vehicles (BEVs), Plug-in Hybrid Electric Vehicles (PHEVs), and Extended-Range Electric Vehicles (EREVs) all utilizing batteries to power their electric motors. The global EV battery market is expected to reach Gigawatt hours of production capacity by 2030. Traditional Internal Combustion Engine (ICE) vehicles are being phased out in favor of EVs to reduce carbon emissions and improve energy security. While lithium-ion batteries are currently the most common EV batteries, alternative technologies such as Lead acid and Nickel-metal hydride batteries are also used in certain applications. The Lithium-ion segment is expected to continue dominating the market due to its superior performance, but solid-state batteries may disrupt the market in the future.

Market Research Overview

The Electric Vehicle (EV) battery market is experiencing rapid growth as the shift towards sustainable transportation gains momentum. EV batteries play a crucial role in powering electric vehicles, offering various benefits such as longer driving ranges, faster charging times, and improved battery life. Lithium-ion batteries are currently the most popular EV battery technology, with solid-state batteries and other advanced chemistries like Lithium Iron Phosphate and sodium-ion batteries emerging as potential contenders. Automakers are investing heavily in EV technology, with some announcing new models like the Cadillac Lyriq, and collaborating with battery manufacturers to increase manufacturing capacity. The EV battery market is expected to reach new heights in the coming years, with Gigawatt hours of production capacity being added through gigafactories and other large-scale manufacturing facilities. The supply chain for EV batteries involves mining and refining of raw materials like lithium, cobalt, nickel, and other elements, which can impact battery prices and energy security. Other alternative fuel vehicles like hydrogen and ethanol vehicles are also being explored, but EVs remain the front-runners in the race towards a sustainable future. The battery market is segmented into Lithium-ion segment and Lead-acid segment, with Battery Electric Vehicles (BEVs), Plug-in Hybrid Electric Vehicles (PHEVs), and Extended Range Electric Vehicles (EREVs) making up the majority of sales. The battery pack price continues to decrease as manufacturing technologies like cell-to-pack and cell-to-chassis improve energy density and battery performance. Companies like QuantumScape, Solid Power, and Northvolt are leading the way in developing new battery technologies to further enhance the capabilities of EV batteries.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

• Type
• Lithium-ion Battery
• Lead-acid Battery
• Others
• Vehicle Type
• Battery Electric Vehicle
• Plug-in Hybrid Electric Vehicle
• Hybrid Electric Vehicle
• Geography
• APAC
• Europe
• North America
• South America
• Middle East And Africa

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

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SOURCE Infiniti Research, Inc.