Market Trends of Pakistan Lithium-ion Battery Industry
This section covers the major market trends shaping the Pakistan Lithium-ion Battery Market according to our research experts:
Consumer Electronics Application to Witness Significant Growth
- Lithium-ion batteries are commonly used in electronic devices, such as smartphones, laptops, clocks, watches, and remote controls. The sales of consumer electronics are highly dependent on the population and the disposable income. The increasing disposable incomes of the Pakistani people are leading to rising living standards and are driving the demand for consumer electronics.
- In 2019, the consumer electronics segment accounted for the largest share of the Li-ion battery market in Pakistan. This segment is expected to continue its dominance in the coming years, owing to a significant rise in the production and the demand for electronic appliances, such as smart phones, cooling equipment, electric motors, TVs, watches, and electronic security systems over the past few years.
- Moreover, Dawlance (one of the leading consumer electronics brands in Pakistan), in November 2020, has been ranked as the number one home appliance brand in the country by IPSOS (Institut de Publique Sondage d'Opinion Secteur), a global market research firm. The company has been serving consumers for more than 40 years, and has been one of the market leaders with three manufacturing units in the country and more than 10 million refrigerators produced till 2020.
- Also, Daraz (one of the biggest e-commerce player in Pakistan) stated that more than 1.7 million buyers purchased electronic products and more than 4 million orders were placed through their platform, resulting in upwards of 5 million items sold. Additionally, smart televisions, washing machines, traditional laptops, LED televisions, smart watches, refrigerators, and food preparation units have also been popular, thus, increasing the demand for consumer electronic sector in the country.
- Therefore, based on the above-mentioned factors, consumer electronics segment is expected to witness significant growth in Pakistan during the forecast period.
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Growth of Electric Vehicles and Renewable Energy Driving the Market
- The initiation of electric vehicle assembling projects in Pakistan is expected to boost the lithium-ion battery market in the coming years. Lithium-ion batter (LIB) is a commonly used battery type and is considered as one of the key components of electric vehicles. Moreover, LIB is increasingly becoming a preferred choice of application in EV's on account of its economic benefits.
- The government has been working towards increasing the integration of EV in the country's automobile sector and has set a target of 30% vehicles operating on batteries by 2030.
- The transportation sector in Pakistan has been experiencing double-digit growth. Almost the whole of the transportation sector is dependent on oil-based products, and the country spends nearly USD 13 billion on the import of oil every year. If the transportation sector continues to grow at the same rate, the bill for oil imports is expected to reach around USD 30 billion by 2025. Therefore, shifting to electric vehicles is likely to solve several sectors' present and impending problems, including transportation, environment, economy, power, and oil import bill.
- The running cost of electric vehicles is one-third of the flexible-fuel vehicle (FFV), but the capital cost is quite high. Moreover, the present infrastructure for EV in the country is not good enough. Therefore, the Pakistani government has been planning to implement incentives to support EVs' adoption and domestic manufacturing. The five domestic EV manufacturers joined forces as the Pakistan Electric Vehicles Manufacturing Association (PEVMA) to make significant investments in the sector, leading to higher demand for lithium-ion batteries in the country.
- Moreover, the introduction of net-metering legislation for solar installations which allows consumers to sell power to the grid is also expected to increase the demand for batteries. Net-metering is increasing the adoption of rooftop solar by homeowners and presents an opportunity to electrify remote villages and commercial enterprises that have sufficient rooftop space and available land.
- Hence, such a significant expansion of renewable energy capacity is expected to come from sources majorly, including wind and solar. Since electricity supply from renewable energy is not stable, batteries are a must to store (especially lithium-ion batteries) when excess electricity is being supplied and then later supply electricity when generation from renewable energy drops.
