Traction Battery Market - Forecast(2024 - 2030)

Traction Battery Market Overview:

Global Traction Battery Market size is estimated to reach $70 billion by 2031, growing at a CAGR of 12.7% during the forecast period 2024-2031. The growing awareness of environmentally friendly automobiles, along with rising volatility in gasoline prices, has increased demand for electric vehicles. According to the International Energy Agency's (IEA) Global EV Outlook 2023, global sales of electric vehicles surpassed 10 million in 2022, representing a 40% increase year on year. Furthermore, factors such as transportation electrification and increased investment will drive the rise of electric cars. Traction batteries, which are used to power electric motors in electric or hybrid cars, have shown tremendous development as demand for electric vehicles has increased. This might be one of the primary forces responsible for the expansion of the traction battery market.

Moreover, attributes such as recyclability, cheap cost, and eco-friendliness are providing an extra push to the market's expansion in the electric vehicle category, consequently boosting market growth. Because of their extended service life, lightweight packs, and increasing power storage capacity, traction batteries are also ideal for industrial applications. Increasing industrialization, growing e-commerce penetration, and advances in material handling technologies will help to the growth of the traction battery market.

Market Snapshot:

Traction Battery market - Report Coverage:

The “Traction Battery market - Forecast (2024-2031)” by IndustryARC, covers an in-depth analysis of the following segments in the Traction Battery Market.

COVID-19 / Ukraine Crisis - Impact Analysis: 

●      The traction battery industry is projected to take a long time to recover from the effects of the COVID-19 epidemic. Despite this, the product's poor acceptance rate, along with the pandemic, has severely impacted the market. However, lessening regulations, rising demand for electric cars, and more consumer awareness of green energy are expected to aid in market recovery. Several enterprises shutdown or reduced their operations due to the potential of infection among their personnel, slowing traction battery manufacturing rates during the COVID-19 Period.

●   The supply chain disruption due to the Russia-Ukraine war has impeded the Traction Battery Market growth. The disruption has increased freight charges, created container shortages and lowered the availability of warehousing space. This has resulted in inflationary issues in the aftermarket.

Key Takeaways:

●      Fastest Growth of Asia Pacific Region

Asia-Pacific emerged as the leading market for traction batteries in 2023 and is projected to exhibit the highest compound annual growth rate (CAGR) in the coming years. The escalating demand for consumer goods has acted as a catalyst for the expansion of the industrial manufacturng sectors in countries such as China, India, and others, which heavily rely on traction batteries to power their industrial equipment systems. Consequently, this is expected to drive the growth of the traction battery market in the Asia-Pacific region. Furthermore, the mounting environmental concerns and government initiatives have provided impetus to the advancement of electric vehicles, which extensively employ traction batteries to power their electric motors. A study by Business Standard, for example, has forecasted an upsurge in electric vehicle sales in India from 2020 to 2023. Consequently, there is an anticipated rise in sales of traction batteries for electric cars, thereby creating a highly profitable market potential.

●      Lead Acid Traction Battery to have the fastest growth

In 2020, the lead acid based segment was the largest revenue generator and is anticipated to grow at a significant rate during the forecast period. The increasing population has surged the growth of the automotive & transportation sector where lead acid-based traction batteries are widely used to power road vehicles, locomotives, industrial forklift trucks, and others. For instance, according to a report published by the Indian Ministry of Commerce and Industry, the transport sector in India is expected to grow at a CAGR of 5.9%, thereby becoming one of the fastest-growing sectors. This may positively drive the growth of the traction battery market for lead-acid type.

●      Rising electrification of the transportation industry is propelling the market.

The transportation sector is undergoing a significant shift towards electric vehicles as a means to reduce greenhouse gas emissions and dependence on fossil fuels. EVs require traction batteries to store and deliver electrical energy, driving the demand for these batteries. Advancements in battery technology, such as improved energy density, longer driving ranges, and faster charging times, have made electric vehicles more viable for everyday use. These technological developments have increased consumer confidence in EVs and subsequently boosted the demand for traction batteries.

●      Growing Industrial Manufacturing Sectors

The industrial manufacturing sectors, particularly in emerging economies like China, India, and others in the Asia-Pacific region, are experiencing significant growth. This expansion is driven by the increasing demand for consumer goods. Traction batteries are used to power industrial equipment systems, such as forklifts and material handling equipment, supporting the growth of these sectors and driving the demand for traction batteries.

●      Concerns about Safety and Recycling may impede market expansion.

Traction batteries need to meet stringent safety standards to prevent incidents such as thermal runaway, fire, or explosion. Ensuring the safety of traction batteries throughout their lifecycle, from manufacturing to disposal, is a challenge for the industry. Additionally, the recycling and proper disposal of traction batteries at the end of their life are crucial for environmental sustainability. Developing efficient recycling processes and implementing proper disposal measures are ongoing challenges.

Key Market Players:

Product/Service launches, approvals, patents and events, acquisitions, partnerships and collaborations are key strategies adopted by players in Traction Battery Market. The top 10 companies in this industry are listed below:

1. Toshiba Corporation (Dynabook, Toshiba Tec, Toshiba Industrial Products and Systems Corporation)
2. BAE Batteries GmbH (BAE Stationary, BAE Solar)
3. Banner Batteries, Ltd. (Running Bull, Power Bull, Buffalo Bull, Bike Bull)
4. Exide Industries, Ltd. (Exide Care, Exide Tubular)
5. ECOVOLTA (ecoPower Trolley, evoTraction Battery)
6. INTILION GmbH (Scalebloc, Scalestac, Scalecube)
7. Leoch International Technology Ltd., Inc. (Leoch Battery, Leoch Network, Leoch Transportation)
8. Yuasa International Ltd. (GYZ, YTZ, AGM, YUMICRON)
9. Inci Aku (AGM Leo, Max Tigris, Gorilla, Taurus)
10. BYD Company (BYD Auto, Blade Battery, BYD solar, BYD Tang)

Scope of Report: