Electric Vehicle Battery Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

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 Summary
Study Period: 2019-2027
Base Year: 2021
Fastest Growing Market: Asia Pacific
Largest Market: Europe
CAGR: 31.56 %
Electric Vehicle Battery Market Major Players

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Market Overview

The electric vehicle (EV) battery market is expected to value USD 218.47 billion in 2027, from USD 34.08 billion in 2020, registering a CAGR of 31.56% during the forecast period. The outbreak of COVID-19 did have some impact on the supply chain of electric vehicles and electric vehicle batteries due to global supply chain disruption, but the impact was short-lived and had a short-term impact on the market. Electric vehicle sales eventually grew by around 41% from around 2.11 million units in 2019 to around 2.97 million units in 2020, while the electric vehicle sales growth between 2018 and 2019 was just around 5.2%. 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 witness a significant growth in 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 includes:

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)
Geography
North America
Europe
Asia-Pacific
Rest of the World

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Key Market Trends

Lithium-ion Battery to Dominate the Market

  • Lithium-ion battery is gaining more popularity compared to other battery types, majorly due to its favorable capacity-to-weight ratio. Other factors that contribute towards boosting its adoption include better performance (long life and low maintenance), better shelf life, and decreasing price. The price of lithium-ion batteries is usually higher than other batteries. However, major players across the market have been investing to gain economies of scale and R&D activities, to enhance their performance, increasing the competition and in turn, resulting in declining prices of lithium-ion battery.​ ​
  • Lithium-ion batteries have traditionally been used mainly in consumer electronic devices, such as mobile phones and PCs, but are increasingly being redesigned for use as the power source of choice in hybrid and the complete electric vehicle (EV) range, owing to factors, such as low environmental impact, as EV does not emit any CO2, nitrogen oxides, or any other greenhouse gases. ​
  • A lithium-ion battery is a type of rechargeable battery installed in electric vehicles and has a higher energy density when compared to nickel-cadmium and lead-acid rechargeable batteries. These features of the lithium-ion batteries will enable the manufacturers to save space by reducing the overall battery pack size. It is one of the lightest metals. Although lithium-ion batteries do not contain any lithium metal, they contain ions. ​
  • Lithium-ion batteries are more than safer than other battery technologies, and all the battery manufacturers ensure safety measures and standards to protect consumers in case of a battery failure. ​
  • The emergence of new and exciting markets via electric vehicles for both personal and commercial vehicle applications is projected to drive the demand for lithium-ion batteries across the globe. Furthermore, lithium-ion batteries have several merits over other batteries (i.e., valve-regulated lead-acid), which make it preferable to be used in data centers.​
  • Further, the share of EVs in total passenger cars has been increasing and owing to the increased sales, the demand for lithium-ion batteries in Europe and North America has been increasing. Moreover, with the ‘Green Deal policy’ launched in 2019 by the European Union, the share of EVs is likely to increase, further driving the demand for lithium-ion batteries during the forecast timeframe. ‘Green Deal Policy’ aims to reduce the carbon emission by more than 50% by 2030 to achieve carbon neutrality target by 2050.​
  • Hence, owing to the above points, the lithium-ion batteries are expected to dominate the market during the forecast period.
Electric Vehicle Battery Market : Electric Car Sales, in Thousand Units, Global, 2014-2020

Asia-Pacific Expected to Witness Significant Growth

  • 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.
  • 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.
  • 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.
  • In India, lithium-ion batteries are mainly used in electric vehicles. India is a major importer of lithium-ion batteries in the Asia-Pacific region and during 2019-20, the country had imported approximately 450 million units of lithium batteries used in a range of electrical equipment, products, and EVs and were valued at an estimated INR 6,600 crore (approx. USD 929.26 million), with China, Japan, and South Korea being the major trading partners.​
  • The government of India is targeting the conversion of two and three-wheelers into 100% electric ones and the total automotive sales to 30% into e-mobility by 2030. Currently, India is dependent on other countries for sourcing EV batteries, which has resulted in the hiked price of EVs. The penetration of EVs in the Indian automotive sector is expected to bolster indigenous manufacturing of Li-ion batteries to make them economically viable.
  • Hence, owing to the above points, Asia-Pacific is expected to witness a significant growth in EV battery market during the forecast period.
Electric Vehicle Battery Market : Growth Rate by Region, 2022-2027

Competitive Landscape

The electric vehicle battery market is moderately fragmented. Some of the major companies operating in this market include Panasonic Corporation, LG Energy Solution 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. INTRODUCTION

    1. 1.1 Scope of the Study

    2. 1.2 Market Definition

    3. 1.3 Study Assumptions

  2. 2. EXECUTIVE SUMMARY

  3. 3. RESEARCH METHODOLOGY

  4. 4. MARKET OVERVIEW

    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 2027

    4. 4.4 Government Policies and Regulations

    5. 4.5 Recent Trends and Developments

    6. 4.6 Investment Opportunities

    7. 4.7 Market Dynamics

      1. 4.7.1 Drivers

      2. 4.7.2 Restraints

    8. 4.8 Supply Chain Analysis

    9. 4.9 Porter's Five Forces Analysis

      1. 4.9.1 Bargaining Power of Suppliers

      2. 4.9.2 Bargaining Power of Consumers

      3. 4.9.3 Threat of New Entrants

      4. 4.9.4 Threat of Substitutes Products and Services

      5. 4.9.5 Intensity of Competitive Rivalry

  5. 5. MARKET SEGMENTATION

    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

  6. 6. COMPETITIVE LANDSCAPE

    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 Energy Solution 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
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

**Subject to Availability

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Frequently Asked Questions

The Electric Vehicle Battery Market market is studied from 2019 - 2027.

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 Billion USD in 2019.

The Electric Vehicle Battery Market is valued at 218 Billion USD in 2027.

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

Europe holds highest share in 2021.

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

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