Vietnam Battery Market Size & Share Analysis - Growth Trends and Forecast (2026 - 2031)

Vietnam Battery Market Trends and Insights

Declining Lithium-Ion Cell Prices

Pack costs for lithium-iron-phosphate systems slid under USD 100 per kWh in 2023, and global averages are poised to fall another 40% by 2030.^{[3]International Energy Agency, “Global EV Outlook 2024,” iea.org} Material expenses dominate cell economics, so cheaper cathodes quickly translate into lower vehicle and storage prices. Vietnam’s e-motorcycle segment, already the world’s fourth largest, becomes price-competitive with 125 cc gasoline scooters once packs hit USD 80 per kWh, accelerating two-wheeler replacement. Industrial users see payback periods drop below three years when swapping valve-regulated lead-acid for lithium-ion, spurring uninterruptible-power-supply upgrades. Ho Chi Minh City’s plan to convert 400,000 motorcycles to electric propulsion starting in 2026 will test whether falling cell prices convert intent into mass adoption.

Surge in EV and E-Bike Adoption

Electric cars captured about 40% of new passenger-car sales in 2025, a level unrivaled in Southeast Asia and driven almost entirely by VinFast’s domestic ramp-up. Hanoi’s July 2026 ban on fossil-fuel motorcycles inside Ring Road 1 acts as a regulatory catalyst for two-wheeler electrification, while budget constraints postpone similar conversion in public bus fleets. Competition in e-motorcycles remains intense as Chinese brands such as Yadea battle local assemblers across battery-swap and plug-in architectures. Premium models deploy swappable lithium-ion packs, whereas ultra-low-cost options cling to lead-acid, bifurcating supply needs. Decision 876/QD-TTg further mandates 50% electrification of urban transport by 2030, solidifying long-term demand.^{[4]Government Office, “Decision 876/QD-TTg on Urban Transport Electrification,” chinhphu.vn}

Government Incentives for Local Manufacturing

Hanoi’s battery strategy links preferential tax, land-lease, and import-duty relief to projects in selected economic zones, notably Ha Tinh and Hai Phong. These carrots helped attract the 5 GWh VinES-Gotion lithium-iron-phosphate plant and sealed LG Energy Solution’s memorandum with Kim Long Motor targeting 1 GWh in Hue by mid-2026. Manufacturing incentives also stipulate localization ratios that push suppliers to build module and pack lines inside Vietnam. Policy clarity on battery waste and recycling under Circular 02/2022/TT-BTNMT, though nascent, signals a full-life-cycle orientation that appeals to multinationals under ESG scrutiny. If fully executed, fiscal levers could shave capital costs enough to offset raw-material import premiums.

VinFast/VinES Vertical-Integration Investments

VinES’ Ha Tinh cell complex underpins VinFast’s plan to surpass 200,000 EVs annually by 2027. The USD 2 billion funding pipeline from Vingroup illustrates a high commitment but concentrates volume risk in a single automaker. Pilot battery-energy-storage deployments at the Vinpearl resort showcase ambition to diversify revenue streams, although the absence of an ancillary-services market hampers returns. VinFast’s ProLogium tie-up aims to commercialize sulfide solid-state cells with 800 Wh per liter energy density by 2029, offering a local first-mover edge if timelines hold. Successful vertical integration could carve a defensible domestic supply chain, yet export penetration in North America and Europe remains an execution overhang.

Reliance on Pumped-Hydro Over BESS

Vietnam’s revised Power Development Plan VIII targets up to 16.3 GW of battery storage by 2030, yet historic preference for pumped-hydro keeps lithium-ion projects sidelined. Pumped-hydro’s longer discharge and multi-decade asset life appeal to planners, while lithium-ion’s sweet spot lies in short-duration frequency regulation. Electricity of Vietnam launched a 50 MW/50 MWh pilot in 2024 but has yet to publish standardized grid-connection codes for independent operators. Without a wholesale ancillary-services market, developers rely on time-of-use arbitrage alone, which seldom clears investment hurdles at USD 250–350 per kWh installed. Grid-scale deployment thus lags even as solar and wind curtailment rise in high-penetration provinces.

Limited Domestic Raw-Material Base

Vietnam boasts sizable nickel and graphite reserves yet lacks refinery throughput, resulting in near-total dependency on imported lithium compounds and cathode materials. Projected domestic demand of 46.9 GWh by 2030 will require roughly 9,400 t of lithium-carbonate equivalent and 23,500 t of cathode powders each year. Exposure to Chinese supply chains raises price and geopolitics risks. Extended producer responsibility rules under the Law on Environmental Protection 2020 and Circular 02/2022/TT-BTNMT mandate battery waste collection, yet hydrometallurgical recycling remains embryonic, limiting closed-loop material recovery. Absent upstream investments or offtake deals with Australian or Chilean miners, the Vietnam battery market stays a cell-assembly hub rather than a vertically integrated powerhouse.

Segment Analysis

By Battery Type: Rechargeables Dominate Amid EV Surge

Secondary rechargeable batteries held 84.9% of the Vietnam battery market share in 2025 and are expanding at an 11.5% CAGR through 2031, outstripping overall growth. The surge reflects VinFast’s volume ramp, e-motorcycle proliferation, and 5G tower upgrades shifting from lead-acid to lithium-ion. Industrial power-backup buyers now value 3,000-cycle life and reduced maintenance, nudging valve-regulated lead-acid out of telecom cabinets. T&T Group’s planned 2 GWh storage-products facility, scaling to 10 GWh, illustrates rising confidence in rechargeable demand.

Primary cells maintained a 15.1% foothold in 2025, concentrated in remote sensors, medical devices, and low-drain consumer goods, where shelf life trumps cycle costs. Yet the transition to USB-C charging and energy-harvesting IoT nodes caps growth. Rechargeable momentum implies incremental demand of nearly 8 GWh by 2031, pressuring domestic producers to secure cathode supply even as automotive volumes dominate. The Vietnam battery market size for rechargeables could therefore eclipse USD 1.5 billion by 2031 if localization targets hold.

Note: Segment shares of all individual segments available upon report purchase

By Technology: Solid-State Disruption Looms Over Li-Ion

Lithium-ion retained 55.2% share in 2025, but solid-state chemistries are set to post a blistering 29.8% CAGR, the highest among all platforms. Lead-acid still served 28% of demand in starter-lighting-ignition and industrial motive niches due to low capex and robust recycling streams. Nickel-metal hydride, nickel-cadmium, sodium-sulfur, and flow batteries together comprised less than 7%, confined to specialized use cases.

Solid-state’s advance hinges on ProLogium’s and SK On’s pilot lines that promise 800 Wh per liter energy density by 2029. Eliminating flammable liquid electrolytes addresses thermal-runaway risk, a critical safety differentiator for buses and high-capacity storage. Vietnam’s first solid-state volumes will likely feed VinFast's premium EV models, creating an early local demand anchor. The Vietnam battery market size for solid-state could approach USD 400 million by 2031 if commercialization timelines hold.

By Application: Automotive Leads While Industrial Stabilizes

Automotive captured 42.5% of the Vietnam battery market size in 2025 and is forecast to expand at a 13.3% CAGR through 2031, adding about 5 GWh in incremental demand. Hanoi’s fossil-fuel motorcycle ban inside Ring Road 1 and Ho Chi Minh City’s 400,000-unit conversion plan intensify two-wheeler consumption, while VinFast targets export growth. Industrial stationary batteries accounted for 35% of demand but trail with an 8% CAGR because energy-storage revenues remain policy-constrained. Portable electronics held an 18% share, growing 6% annually as foldable devices and AR wearables lift per-unit capacity despite mature smartphone penetration.

Power tools and residual starter-lighting-ignition segments combine for 5%, showing minimal expansion. The Vietnam battery market share weighted to automotive exposes the ecosystem to cyclical passenger-car swings and to VinFast’s export execution risk, underscoring diversification needs into industrial and grid segments once regulatory clarity improves.

Note: Segment shares of all individual segments available upon report purchase

Geography Analysis

Northern provinces led by Hanoi, Hai Phong, and Ha Tinh account for nearly two-thirds of Vietnam's battery market demand, anchored by VinFast’s vehicle line and VinES’ upcoming cell complex. Proximity to China’s Guangxi border enables just-in-time cathode and BMS imports but poses geopolitical exposure. Southern zones around Ho Chi Minh City supply consumer electronics packs yet lack major EV-cell commitments, although Google Cloud’s 2024 data-center launch stimulated lithium-ion UPS upgrades.

Central Vietnam, notably Hue and Da Nang, emerges as a secondary hub following LG Energy Solution’s collaboration with Kim Long Motor. Infrastructure gaps, including shallow-draft ports and intermittent grid reliability, limit scale for now. Rural Mekong Delta provinces lag due to sparse charging networks, though electric fishing vessels and agricultural machinery present niche opportunities if battery costs fall another 30% by 2028. Within ASEAN, Vietnam competes with Thailand’s USD 1.4 billion battery project pipeline and Indonesia’s nickel-anchored gigafactories BOI.GO.TH. Local rare-earth reserves lend a future comparative advantage for motor magnet supply, but the absent of lithium resources keeps the country dependent on imports.