Electric Vehicle Battery Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

The market is segmented by Battery Type (Lead-acid Battery, Lithium-ion Battery, and Other Battery Types), Vehicle Type (Battery Electric Vehicle (BEV), Plug-in Hybrid Electric Vehicle (PHEV), and Hybrid Electric Vehicle (HEV)), and Geography (North America, Europe, Asia-Pacific, and Rest of the World)

Market Snapshot

Electric Vehicle Battery Market Overview
Study Period: 2019- 2026
Base Year: 2020
Fastest Growing Market: Asia Pacific
Largest Market: Europe
CAGR: 31.56 %

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Market Overview

The electric vehicle (EV) battery market is expected to value USD 166.06 billion in 2026, from USD 34.08 billion in 2020, registering a CAGR of 31.56% during the forecast period 2021 to 2026. The COVID-19 pandemic had very little impact on the electric vehicle industry as the most important market. China started growing after the first two months of 2020, and even Tesla was able to continue its production throughout the pandemic. The concerns regarding the negative effect of climate change and the growing carbon emission in major cities have created a significant demand for electric vehicles. The EV30-30 Scenario targets increasing the market share for electric vehicles (EVs) to 30% by 2030 (excluding two/three-wheelers). The supportive government policies to promote electric vehicle sales are expected to increase the demand for EV batteries over the forecast period. However, the high cost of electric vehicles, the demand-supply gap of the vital raw materials such as cobalt, and the lack of charging infrastructure are expected to restrain the growth of the market.

  • The lithium-ion battery segment is expected to dominate the market over the forecast period. The technological advancements, which have led to a sharp increase in the energy density of the lithium-ion battery market even while decreasing the overall cost of lithium-ion batteries, have enabled the increase in uptake of li-ion powered EVs.
  • Supportive government policies and investment for the deployment of the public charging infrastructure clubbed with the increasing efficiency of the electric vehicle are expected to create a significant opportunity for the market's growth in the near future.
  • Asia-Pacific is expected to dominate the EV battery market, owing to the increasing demand from countries such as China, India, Japan, and other countries.

Scope of the Report

The electric vehicle battery market report include:

Battery Type
Lead-acid Battery
Lithium-ion Battery
Other Battery Types
Vehicle Type
Battery Electric Vehicle (BEV)
Plug-in Hybrid Electric Vehicle (PHEV)
Hybrid Electric Vehicle (HEV)
North America
Rest of the World

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Key Market Trends

Lithium-ion Battery to Dominate the Market

  • The lithium-ion battery is expected to dominate the market during the forecast period due to its high energy density, fast recharging capability, and high discharge power. Lithium-ion batteries are the only available technology that is capable of meeting OEM requirements for vehicle driving range and charging time.
  • Additionally, the cost of lithium-ion batteries has been decreasing, reaching a value below USD 137/KWh in December 2020, from around USD 900/KWh in 2011. The decreasing cost of the battery has promulgated the increase in the demand for EVs since the battery cost occupies a large share of the total EV cost.
  • One of the main reasons for the battery's high cost is components such as - Cobalt, lithium, and graphite, which are the primary active components of the cathodes and anodes in lithium-ion batteries. A sudden rise in demand from the EV industry may result in a shortage of these minerals, and it seems likely that the lack of availability of these materials may act as a bottleneck in the production of lithium-ion batteries in the near future.​ This has led to many companies competing to build the next age batteries which can replace the batteries.
  • Furthermore, the recycling of Li-ion batteries is expected to secure the supply of raw materials, such as lithium and cobalt, and reduce the reliance on extracting and refining materials from mineral resources. Recycling of lithium-ion batteries that are currently being used in electric vehicles offers an excellent opportunity for companies to utilize the refined constituent materials for manufacturing lithium-ion batteries that are to be used for energy storage systems (ESS).
  • Hence, lithium-ion batteries are expected to dominate the market due to their technical capacities.
Electric Vehicle Battery Market

Asia-Pacific to Dominate the Market

  • The Asia-Pacific region dominated the global market share in 2020. With the increasing deployment of electric vehicles in countries such as China, Japan, and India, and the high demand for vehicles with urbanization and increasing power purchase parity, the usage of lithium-ion batteries is expected to witness significant growth in the region.
  • China is one of the largest markets for electric vehicles, and the increasing adoption of electric vehicles in the country has been in line with the clean energy policy. Moreover, the Government of China has been providing both financial and non-financial incentives to promote the adoption of electric vehicles.
  • However, in January 2021, China's Ministry of Finance has cut subsidies for electric vehicles (EVs) by 20% for the year 2021, as sales of so-called new energy vehicles (NEVs)—a category covering hybrids, plug-ins, and hydrogen-powered autos—regained momentum after plunging during the pandemic last year.
  • On the other hand, despite the lack of prominent reserves or production of raw material, such as lithium and cobalt, in line with its aspiration to achieve 100% electric vehicle (EV) sales by 2030, is expected to emerge as a regional hotspot for global lithium-ion battery players, during the forecast period.
  • Favorable policies, such as the energy efficiency standards and increasing peak demand charges and technological advances, have led to the commercial and industrial (C&I) sector receiving more attention from project developers, primarily driven by strong growth in China and India, which, in turn, is expected to drive the demand for lithium-ion-based energy storage systems in the region.
  • Hence, Asia-Pacific is expected to dominate the market due to its large population and governmental support.
Electric Vehicle Battery Market

Competitive Landscape

The electric vehicle battery market is moderately fragmented. Some of the major companies operating in this market include Panasonic Corporation, LG Chem Ltd, Contemporary Amperex Technology Co. Ltd, Samsung SDI Co. Ltd, and BYD Co. Ltd., amongst others.

Recent Developments

  • In November 2020, Delhi-based battery maker Inverted Energy announced the opening of its lithium battery manufacturing facility in New Delhi, India. The commissioning of the plant, which currently has a production capacity of 100 MWh (megawatt hour) annually, is aimed at reducing dependence on China.
  • In December 2020, LG Chem Ltd announced its plans to more than double the production capacity of battery cells it makes in China for Tesla Inc electric vehicles (EV) in 2021 to keep up with its US client's growth in the biggest car market. The firm, a supplier for Tesla's Shanghai-built Model 3, will also ship its increased output from China as well as Korea to Tesla's factories in Germany and the United States.
  • In February 2021, Amara Raja Batteries, India's second-largest automotive battery maker, has opened its maiden technology hub to develop lithium-ion cells at its Tirupati facility in Andhra Pradesh.

Table of Contents


    1. 1.1 Scope of the Study

    2. 1.2 Market Definition

    3. 1.3 Study Assumptions




    1. 4.1 Introduction

    2. 4.2 Evolution of Electric Vehicle Battery Technology

    3. 4.3 Market Size and Demand Forecast in USD billion, until 2026

    4. 4.4 Government Policies and Regulations

    5. 4.5 Recent Trends and Developments

    6. 4.6 Market Dynamics

      1. 4.6.1 Drivers

      2. 4.6.2 Restraints

    7. 4.7 Supply Chain Analysis

    8. 4.8 Porter's Five Forces Analysis

      1. 4.8.1 Bargaining Power of Suppliers

      2. 4.8.2 Bargaining Power of Consumers

      3. 4.8.3 Threat of New Entrants

      4. 4.8.4 Threat of Substitutes Products and Services

      5. 4.8.5 Intensity of Competitive Rivalry


    1. 5.1 Battery Type

      1. 5.1.1 Lead-acid Battery

      2. 5.1.2 Lithium-ion Battery

      3. 5.1.3 Other Battery Types

    2. 5.2 Vehicle Type

      1. 5.2.1 Battery Electric Vehicle (BEV)

      2. 5.2.2 Plug-in Hybrid Electric Vehicle (PHEV)

      3. 5.2.3 Hybrid Electric Vehicle (HEV)

    3. 5.3 Geography

      1. 5.3.1 North America

      2. 5.3.2 Europe

      3. 5.3.3 Asia-Pacific

      4. 5.3.4 Rest of the World


    1. 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements

    2. 6.2 Strategies Adopted by Leading Players

    3. 6.3 Market Share Analysis

    4. 6.4 Company Profiles

      1. 6.4.1 Panasonic Corporation

      2. 6.4.2 LG Chem Ltd

      3. 6.4.3 Contemporary Amperex Technology Co. Ltd

      4. 6.4.4 Samsung SDI Co. Ltd

      5. 6.4.5 BYD Co. Ltd

      6. 6.4.6 Narada Power Source Co. Ltd

      7. 6.4.7 East Penn Manufacturing Company

      8. 6.4.8 GS Yuasa Corporation

      9. 6.4.9 Clarios

      10. 6.4.10 Hitachi Ltd

    5. *List Not Exhaustive

**Subject to Availability

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Frequently Asked Questions

The Electric Vehicle Battery Market market is studied from 2019 - 2026.

The Electric Vehicle Battery Market is growing at a CAGR of 31.56% over the next 5 years.

The Electric Vehicle Battery Market is valued at 34.08 Billion USD in 2019.

The Electric Vehicle Battery Market is valued at 166.06 Billion USD in 2026.

Asia Pacific is growing at the highest CAGR over 2021- 2026.

Europe holds highest share in 2020.

Panasonic Corporation , LG Chem Ltd., Contemporary Amperex Technology Co Ltd, Samsung SDI Co. Ltd., BYD Company Limited are the major companies operating in Electric Vehicle Battery Market.

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