Pune, India, Feb. 10, 2023 (GLOBE NEWSWIRE) -- The global electric vehicle market size is projected to grow worth USD 154.90 billion in 2028, with a projected compound annual growth rate (CAGR) of 28.1% from 2021 to 2028. This growth is driven by the need to reduce reliance on non-renewable energy sources and support the global push for sustainable development, as outlined by the United Nations. The growing concerns about pollution and carbon emissions, which are contributing to global warming and climate change, are also driving demand for electric vehicles and their batteries. As the demand for electric vehicles rises, it is expected to drive the growth of the electric vehicle battery market.
The demand for electric vehicles (EVs) is on the rise, as consumers increasingly seek more sustainable and environmentally friendly modes of transportation. This growth in demand has created a corresponding increase in demand for electric vehicle batteries, which are critical components in EVs. Companies in the market are investing heavily in R&D to create more advanced and efficient batteries for EVs, and the market is expected to be highly competitive in the coming years.
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Our expert analysts predict that the growing emphasis of key vehicle manufacturers, including Ford Motors, General Motors (GM), and BMW AG, on producing and introducing Electric Vehicles (EVs) will drive market growth.
The development of EV batteries is crucial in reducing the cost of EVs and increasing their driving range per recharge. New cell chemistries are being developed to make EV batteries smaller, lighter, and more energy-efficient, thus enabling electric vehicles to compete with traditional gasoline-powered vehicles. The market size was valued USD 21.95 billion in 2020. This information is provided by Fortune Business Insights™, in its report, titled, “Electric Vehicle Battery Market, 2021-2028.”
Key Market Drivers
The electric vehicle (EV) battery market is witnessing a rapid increase in adoption with the growing popularity of electric vehicles. The market size of the global EV battery industry is expected to grow significantly in the coming years, driven by the increasing demand for sustainable transportation options.
There are several key factors driving the growth of the electric vehicle battery market, including:
- Government initiatives to promote the adoption of EVs
- Increasing concerns about carbon emissions and air pollution
- Technological advancements in battery technology
- Declining costs of batteries
The use of lithium-ion batteries as the primary power source for electric vehicles has been a driving force behind the growth of the rechargeable battery market. In 2018, the U.S. International Trade Commission (USITC) reported that Li-ion batteries account for over 70% of this market. The significant decrease in battery costs per kilowatt-hour (kWh) from 2010, when it was at USD 1000, to under USD 200 in 2019, is expected to drive the growth of the electric vehicle battery market in the coming years. This cost reduction has made it easier for consumers to adopt electric vehicles, and it is a trend that is likely to continue in the future.
Battery technology is constantly evolving, with manufacturers looking to improve the cost and performance of EV batteries. Contemporary Amperex Technology (CATL) is one of the leading companies driving innovation in the EV battery market.
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Key Challenges for Battery Manufacturers
Battery manufacturers are facing several key challenges in meeting the growing demand for EV batteries, including:
- Increasing competition in the market
- The need to improve battery performance, safety, and affordability
- The need to increase production capacity to meet the growing demand
- The need to develop and implement new technologies to stay ahead of the competition
EV battery market faces several challenges such as supply chain disruptions and the high cost of lithium-ion batteries. Despite these challenges, the market growth is expected to continue as the demand for electric vehicles increases and battery technology improves.
Market Opportunities for Battery Manufacturers
Battery manufacturers have several opportunities to capitalize on the growing demand for EV batteries, including:
- Expanding into new markets, such as Asia and Europe, where EV adoption is growing rapidly
- Partnering with automakers and suppliers to create a more efficient and effective supply chain
- Investing in research and development to create new and innovative battery technologies
- Developing new business models, such as battery leasing, to address the growing demand
Market Segmentation:
The electric vehicle battery market is segmented by battery type and vehicle type. In terms of battery type, the market is divided into lead-acid battery, nickel-metal hydride battery, lithium-ion battery, and others. Lithium-ion batteries are expected to dominate the market due to their high energy density, long life cycle, and low maintenance cost.
In terms of vehicle type, the market is segmented into BEVs (Battery Electric Vehicles), PHEVs (Plug-in Hybrid Electric Vehicles), and HEVs (Hybrid Electric Vehicles). BEVs are expected to lead the market due to their increasing adoption and the need for reducing carbon emissions.
The segmentation of the electric vehicle battery market provides a comprehensive understanding of the market dynamics, allowing stakeholders to make informed decisions. With the market forecast to grow at a significant rate, understanding the market segments will help businesses to capitalize on the emerging opportunities and stay ahead of the competition.
Regional Analysis:
Asia Pacific region held the largest electric vehicle battery market share, driven by the high production capability of EV batteries in countries such as Japan, China, and South Korea. In 2020, the market value in the Asia Pacific region was estimated at USD 12.70 billion. The region is expected to continue its dominance in the electric vehicle battery market due to the implementation of stringent regulations aimed at reducing carbon emissions and GHG emissions. The significant contributions of South Korea, Japan, and China in the manufacturing of electric vehicle batteries will also play a major role in maintaining Asia Pacific's dominance in the market in the coming years.
The European electric vehicle battery market was valued at USD 22.76 billion in 2018 and is expected to see growth due to a strong infrastructure for electric vehicles. Additionally, the availability of nickel-metal and lithium-ion batteries from companies at competitive prices is also contributing to the market's growth in the region.
North America is projected to experience significant growth in the electric vehicle battery market. The U.S. government has implemented a federal policy to ensure a secure and stable source of crucial minerals, which directs the Department of the Interior to limit the production of 35 critical minerals, including nickel and cobalt. Original equipment manufacturers in the region are focused on addressing concerns related to battery sourcing from a single region, which is expected to drive growth in the near future. The shift towards electric vehicles due to fluctuating oil prices and the increasing investments in e-mobility projects combined with government support will also drive the market's growth in North America.
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Competitive Landscape:
Prominent companies have confidence in in executing tactics that would reinforce their brand value in the market. Several tactics, such as introducing exclusive products and forming mergers with other crucial companies or end-users for better reach of their products are employed by the company. Partnering up with or attaining numerous corporations is another fundamental tactic used to refine one’s existence in the universal market.
The market for electric vehicle batteries houses several renowned manufacturers, such as Panasonic, Samsung, BYD, and LG Chem. Some of them are participating in collaboration strategy to co-develop new products, while the others are aiming to launch innovative electric vehicle batteries for strengthening their positions.
Industry Developments:
Feb 2023: GM and LG have temporarily suspended their plans to build a fourth electric vehicle battery plant in the United States.
Feb 2023: The electric vehicle (EV) battery company co-founded by a Tesla Co-Founder has been awarded a significant federal loan of $2 billion
EV battery companies analyzed in report:
- Panasonic
- LG Chem
- BYD Company
- GS Yuasa International
- Samsung SDI
- Hitachi Chemical
- Contemporary Amperex Technology
- EXIDE INDUSTRIES
- SK INNOVATION
- East Penn Manufacturing
Table of Content:
- Introduction
- Research Scope
- Market Segmentation
- Research Methodology
- Definitions and Assumptions
- Executive Summary
- Market Dynamics
- Market Drivers
- Market Restraints
- Market Opportunities
- Key Insights
- 4.1 Merger, Acquisitions, and Partnerships
- 4.2 Porter’s Five Forces Analysis
- 4.3 SWOT Analysis
- 4.4 Technological Developments
- 4.5 Impact of COVID-19
- Global Electric Vehicle Battery Market Analysis, Insights and Forecast, 2017-2028
- Key Findings / Summary
- Market Analysis, Insights and Forecast – By Battery Type
- 5.2.1 Lead Acid Battery
- 5.2.2 Nickel-Metal Hydride Battery
- 5.2.3 Lithium-Ion Battery
- 5.2.4 Others
- Market Analysis, Insights and Forecast – By Vehicle Type
- 5.3.1 Battery electric vehicle (BEV)
- 5.3.2 Plug-in hybrid electric vehicle (PHEV)
- 5.3.3 Hybrid electric vehicle (HEV)
- Market Analysis, Insights and Forecast – By Region
- 5.4.1 North America
- 5.4.2 Europe
- 5.4.3 Asia Pacific
- 5.4.4 Rest of the World
- North America Electric Vehicle Battery Market Analysis, Insights and Forecast, 2017-2028
- Key Findings / Summary
- Market Analysis – By Battery Type
- 6.2.1 Lead Acid Battery
- 6.2.2 Nickel-Metal Hydride Battery
- 6.2.3 Lithium-Ion Battery
- 6.2.4 Others
- Market Analysis – By Vehicle Type
- 6.3.1 Battery electric vehicle (BEV)
- 6.3.2 Plug-in hybrid electric vehicle (PHEV)
- 6.3.3 Hybrid electric vehicle (HEV)
- Market Analysis – By Country
- 6.4.1 U.S.
- 6.4.1.1 By Vehicle Type
- 6.4.2 Canada
- 6.4.1.2 By Vehicle Type
- 6.4.3 Mexico
- 6.4.1.3 By Vehicle Type
Continued…
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