Electric Vehicle Battery Market - Forecast(2024 - 2030)

Electric Vehicle Battery Market Overview

Electric Vehicle Battery Market is analyzed to grow at a CAGR of 20.31% during the forecast 2024-2030 to reach $202.60billion in 2030. Electric Vehicle Batteries (EVBs), also referred to as traction batteries, are critical components powering the electric motors of electric vehicles (EVs). These batteries are predominantly rechargeable and commonly utilize lithium-ion or nickel-metal hydride technology. They are engineered to provide high ampere-hour or kilowatt-hour capacities, facilitating prolonged vehicle operation between charging sessions. One prominent trend driving the demand for EVBs is the increasing focus on government policies and investments aimed at bolstering public charging infrastructure. Governments worldwide are recognizing the necessity of supporting the transition to electric mobility by expanding charging networks. This commitment to infrastructure development not only alleviates range anxiety among EV drivers but also encourages greater adoption of electric vehicles by making charging more accessible and convenient. Another significant trend contributing to the growth of EVB demand is the ongoing enhancement of electric vehicle battery management systems (BMS). BMS technology plays a crucial role in monitoring, controlling, and optimizing the performance of EVBs. Advancements in BMS capabilities, such as improved energy efficiency, enhanced safety features, and more accurate state-of-charge predictions, are increasingly enabling EVs to achieve longer ranges and faster charging times. As BMS technologies continue to evolve, they contribute to the overall efficiency, reliability, and longevity of electric vehicle batteries, further catalyzing the widespread adoption of electric mobility. These trends collectively indicate a promising outlook for the electric vehicle industry, positioning EVBs as pivotal components in the transition toward sustainable transportation.

Report Coverage

The report: “Electric Vehicle Battery Industry Outlook – Forecast (2024-2030)”, by Industry ARC covers an in-depth analysis of the following segments of the Electric Vehicle Battery Market.

By Battery Type: Lithium-Ion Batteries, Nickel-Metal Hydride Batteries, Lead-Acid Batteries, Ultracapacitors and Others.

By Battery Capacity: <50 kWh, 51-100 kWh, 101-300 kWh and >300 kWh.

By Electric Vehicle Type: Battery Electric Vehicle (BEV), Hybrid Electric Vehicle (HEV), Plug-in Hybrid Electric Vehicle (PHEV) and Fuel cell Electric vehicle.

By Application: Electric cars (Passenger Cars and Commercial Cars and Others), Electric scooters and Others.

By Geography: North America (U.S., Canada and Mexico); Europe (U.K., Germany, Italy, France, Spain, Russia, Rest of Europe); APAC (China, Japan, South Korea, India, Australia, Rest of APAC); South America (Brazil, Argentina, Rest of Americas); Row (Middle East & Africa).

Key Takeaways

• Asia-Pacific is analysed to hold the highest share of 35% in 2023, owing to the availability of leading market players for the Electric vehicle battery market coupled with the increasing deployment of electric vehicles in this region.
• Increasing environmental concerns towards the adverse impact of conventional vehicles coupled with supportive government policies around the world for the adoption of vehicles using alternative sources of fuel to limit pollution is analysed to significantly drive the Electric Vehicle Battery Market during the forecast period 2024-2030.
• Lithium-ion batteries are analysed to hold the highest share 33.47% in 2023 owing to its huge adoption across various electric vehicles and other technical advantages.
• Electric cars are expected to hold the highest market share 64.21% in the forecast period owing to the increasing production of electric cars over electric scooters.

Electric Vehicle Battery Market Segment Analysis - By Battery Type

By Battery Type, the Electric Vehicle Battery Market Report is segmented into Lithium-Ion Batteries, Nickel-Metal Hydride Batteries, Lead-Acid Batteries, Ultracapacitors, and Others. Lithium-ion batteries are analysed to hold the highest share 33.47% in 2023 owing to its huge adoption across various electric vehicles and other technical advantages over other battery types. The lithium-ion battery offers high energy density, fast recharging capability, and high discharge power as compared to other batteries. Lithium-ion batteries are the only available technology that is capable of meeting OEM requirements for vehicle driving range and charging time. 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 can be used for energy storage systems (ESS). These factors tend to drive the demand of lithium-ion batteries in the Electric vehicle battery market during the forecast period.

Electric Vehicle Battery Market Segment Analysis–By Application

By Application, the Electric Vehicle Battery Market Report is segmented into Electric cars (Passenger Cars and Commercial Cars) and Electric scooters. Electric cars are analysed to hold the highest share of 64.21% during the forecast period 2024-2030 owing to the increasing production of electric cars over the electric scooter. For instance, according to the International Energy Agency (IEA), electric car sales share showed exponential growth by elevating from 4.3% in 2020 to 25% in 2025 and is forecasted to reach 60.9% by 2030. This huge production and sales of electric cars tend to drive its market growth during the forecast period and will contribute significantly to the Electric vehicle battery market growth.

Electric Vehicle Battery Market Segment Analysis – By Geography

Asia-Pacific is analyzed to be the major region with a share of 35% in 2023 for the Electric Vehicle Battery Market owing to the availability of leading market players for the Electric vehicle battery market coupled with increasing deployment of electric vehicles in this 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 and this will tend to propel the demand for electric vehicle batteries during the forecast period. Moreover, the Government of China has been providing both financial and non-financial incentives to promote the adoption of electric vehicles. Favorable policies, such as the energy efficiency standards and increasing peak demand charges, and technological advances in China and India is expected to drive the demand for Electric vehicle batteries in this region. For instance, according to the International Energy Agency (IEA), China maintains its dominance in the electric car market, accounting for 40% of global sales by 2030.  The Indian government aims 30% EVs by 2030, while the auto sector comprises 49% of manufacturing GDP and 7.1% of total GDP. This huge availability of electric cars tends to drive the Electric vehicle battery market growth during the forecast period. 

Electric Vehicle Battery Market Drivers

Increasing demand forzero-emission vehicles owing to increasing environmental concerns across the globe is driving the Electric Vehicle Battery Market growth. Increasing environmental concerns to limit the production of conventional vehicles which has adversely affected the global environment structure has propelled the demand for electric vehicle batteries. Widespread global concerns regarding the negative effects of climate change along with alarming pollution levels recorded in major cities have created a significant demand for zero-emission vehicles. The rise in petrol and diesel prices has added to the demand for fuel-efficient vehicles and enhanced the need for advanced fuel-efficient technologies, leading to a surge in demand for electrically powered vehicles. Economic incentives and regulatory measures are often coupled with other policies that increase the value proposition of EVs. Such policies often aim to harness the multiple co-benefits arising from greater electrification of transport, most prominently energy diversification in a sector that is 90% dependent on oil products and the reduction of local pollutant and GHG emissions. This tends to drive the demand for electric vehicle batteries across the globe, further driving its market growth. 

Increasing registration of electric vehicles across the globe is propelling the demand for electric vehicle batteries

Increasing registration of electric vehicles across various parts of the world is analysed to bring significant growth in the demand of electric vehicle batteries. The increasing technological advancement and environmentally friendly offerings of electric vehicles is set to drive the global automotive sector during the forecast period. This has brought major growth in the manufacturing of highly efficient and long-standing rechargeable batteries. Moreover, conventional automotive manufacturers who used to develop conventional fuel-based automobiles are investing in their research and development for the addition of the electric vehicle segment to their portfolio. This will further drive the demand for electric vehicle batteries across the globe, further driving its market growth. For instance, according to the International Energy Agency (IEA), In 2022, China dominated global electric car registrations with nearly 60% share. Domestic sales saw electric vehicles (NEVs) comprising 29% of total sales, exceeding the 2025 target of 20%. This increasing registration of electric cars will further drive the market growth of electric vehicle batteries during the forecast period.

Electric Vehicle Battery Market Challenges
Lack of charging infrastructure and technical limitations is analyzed to hamper the Electric Vehicle Battery Market growth

One of the most important factors restraining the market growth of the Electric Vehicle Battery Market across the global is the lack of charging infrastructure. There is no doubt that the popularity of electric vehicles has grown exponentially in the last few years owing to environmental concerns, but the limited availability of charging infrastructure across various parts of a country tends to limit the market growth of electric vehicle batteries during the forecast period. Moreover, Electric vehicle batteries are limited by range and speed over conventional fuels such as petrol and diesel. Most of electric cars have a range of about 50-100 miles and need to be recharged again and again if used at maximum throttle. In addition, battery life is another major concern, the electric vehicle battery generally lasts for about 3-4 years if used at maximum efficiency which needs to be replaced. This limits the adoption of electric vehicles further bringing major challenges in the electric vehicle battery market growth during the forecast period.

Electric Vehicle Battery Industry Outlook

Production Innovation, Acquisitions, Collaboration, and R&D activities are key strategies adopted by players in the Electric Vehicle Battery Market. Electric Vehicle Battery top 10 companies includeLG Energy Solution., Panasonic Energy Co., Ltd, Samsung Electronics Co., Ltd, Wanxiang Group Corporation, East Penn Manufacturing Company, Clarios, Hitachi Ltd, Crown Battery, Nissan Motor Co., Ltd., Emerson Electric Co., Exide Industries Limited, among others

Acquisitions/Technology Launches/Partnerships 

Ø  In December 2023, Panasonic Energy Co., Ltd. partnered with Sila for next-gen silicon anode material procurement for EV batteries. This collaboration aims to enhance battery performance, reflecting Panasonic's commitment to advancing electric mobility technology in North America.

Ø  In October 2023, LG Energy Solution and Toyota collaborated to boost the EV market in the U.S. LG Energy Solution will annually provide Toyota with 20GWh of high-nickel NCMA battery modules starting from 2025, powering the future of electric vehicles.