Industry: Chemicals and Materials
Published Date: August-2024
Format: PPT*, PDF, EXCEL
Delivery Timelines: Contact Sales
Number of Pages: 161
Report ID: PMRREP31546
The global market for Lithium-ion battery is expected to increase from US$55.4 Bn in 2024 to US$178.6 Bn by the end of 2031. The market is estimated to record a CAGR of 18.2% during the forecast period from 2024 to 2031.
Key Highlights of the Market
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Attributes |
Key Insights |
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Market Size (2024E) |
US$55.4 Bn |
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Projected Market Value (2031F) |
US$178.6 Bn |
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Forecast Growth Rate (CAGR 2024 to 2031) |
18.2% |
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Historical Growth Rate (CAGR 2018 to 2023) |
15.6% |
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Region |
Market Share in 2023 |
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Asia Pacific |
45% |
Asia Pacific, comprising countries such as China, Japan, India, Australia, Indonesia, Thailand, and others, stands as a pivotal hub for both production and consumption within the lithium-ion battery market.
This region leads globally in manufacturing and is a significant consumer of lithium-ion batteries. Asia Pacific held the market share of 45% and continues to account for large market share.
The region experiences substantial demand for lithium-ion batteries driven by the prolific consumer electronics industry. The increasing penetration of these devices across Asia Pacific nations further amplifies the demand for high-performance batteries.
The demand surge originates primarily from prominent consumer electronics manufacturers based here. Technological advancements in wearable devices and consumer electronics within Asia Pacific are also contributing significantly to the growth of the lithium-ion battery market in this region.
Lithium Nickel Manganese Cobalt Oxide Retains the Top Spot
The chemistry of lithium ion batteries plays a significant role in the usage and application potential for multiple end-use cases. Lithium nickel manganese cobalt oxide and lithium ion phosphate jointly account for nearly 70% of the market share by value.
High specific energy characteristics, low internal resistance, and versatility to suit different power capacity configurations are the key factors. These factors are driving the leadership of the lithium nickel manganese cobalt oxide battery type in the market.
The inherently safe nature, high current rating, and long life cycle of lithium ion phosphate chemistry is driving the demand for this type in the market.
Lithium-ion batteries are crucial for the electrification of transportation. They offer high energy density, enabling longer driving ranges and fast charging times compared to traditional batteries. The push toward reducing greenhouse gas emissions and improving air quality has accelerated the adoption of EVs globally.
The global Lithium-ion battery market has experienced substantial growth over the past decade and is projected to continue expanding at a robust pace. Factors driving this growth include the increasing adoption of electric vehicles (EVs), rising demand for energy storage solutions, and advancements in battery technology.
In the renewable energy sector, lithium-ion batteries are used in energy storage systems to store electricity generated from solar and wind sources. These batteries help stabilize the grid by providing backup power during peak demand periods and smoothing out fluctuations in renewable energy generation.
Increasing consumer demand for longer battery life, faster charging, and lightweight electronics has spurred innovation in lithium-ion battery technology, pushing manufacturers to develop more efficient and durable battery solution.
High demand growth for the market over the next few years is expected to come from applications in electric vehicles, electric bikes, and energy storage applications.
The period from 2019 to 2023 witnessed significant growth and transformative developments in the Lithium-ion battery market, driven by several key market trends. Demand for electric vehicles (EVs) surged during this period, fueled by advancements in battery technology, government incentives promoting electric mobility, and growing environmental awareness.
Lithium-ion batteries became the preferred choice for EV manufacturers due to their high energy density, enabling longer driving ranges, and rapid advancements in charging infrastructure.
The deployment of lithium-ion batteries in energy storage systems (ESS) expanded significantly, supporting the integration of renewable energy sources such as solar and wind into the power grid. The market recorded a CAGR of 15.6% during the historical period.
The electric vehicle market is projected to continue its large expansion, driven by increasing consumer acceptance of electric mobility, stringent emissions regulations and advancements in battery technology.
Lithium-ion batteries will play a crucial role in ESS applications, providing grid stability, enabling peak shaving, and supporting reliable backup power solutions to mitigate intermittency issues associated with renewable energy generation.
Continued research and development efforts will focus on advancing lithium-ion battery technology, including improvements in energy density, cycle life, safety features, and sustainability.
Innovations in battery chemistry, such as solid-state batteries and beyond-lithium-ion technologies, hold potential to further enhance performance and address environmental concerns related to battery manufacturing and recycling. Sales of Lithium-ion battery are estimated to capture a CAGR of 18.2% during the forecast period.
Increasing EV Adoption, and Growing Deployment of Energy Storage Systems
Electric vehicles have emerged as a key driver of the lithium-ion battery market due to their reliance on high-performance batteries for energy storage. The global push toward reducing greenhouse gas emissions and dependence on fossil fuels has accelerated the adoption of electric mobility solutions.
Governments globally are implementing strict emissions regulations and offering incentives to promote EV adoption, further driving market growth. Innovations in lithium-ion battery technology, such as improvements in energy density, charging speeds, and cost reductions, have played a crucial role in making EVs more viable and attractive to consumers.
Battery manufacturers and automakers are continuously investing in research and development to enhance battery performance, increase driving range, and lower manufacturing costs. Consequently, expanding the market for lithium-ion batteries in the automotive sector.
Energy storage systems, including grid-scale batteries and residential energy storage solutions, are another significant driver of the lithium-ion battery market.
These systems play a crucial role in integrating renewable energy sources like solar and wind into the power grid by storing excess electricity generated during peak production periods.
The increasing deployment of renewable energy installations worldwide has heightened the demand for reliable energy storage solutions to ensure grid stability and optimize energy management.
Lithium-ion batteries are preferred for ESS due to their high energy density, efficiency, and ability to charge and discharge rapidly. Governments and utilities are investing in large-scale energy storage projects to support renewable energy integration, mitigate grid fluctuations, and enhance energy security.
Supply Chain Constraints, and Raw Material Availability
One of the primary restraints for the lithium-ion battery market is the supply chain constraints and challenges related to raw material availability. Lithium, cobalt, nickel, and graphite are essential raw materials used in lithium-ion battery production.
The supply of these materials is influenced by geopolitical factors, mining regulations, environmental concerns, and fluctuating demand. Lithium, a critical component in lithium-ion batteries, is primarily sourced from a few key countries such as Australia, Chile, and Argentina.
Despite efforts to expand production capacity, there have been concerns about potential supply shortages as demand for lithium-ion batteries escalates, particularly driven by the electric vehicle market.
Technological and Performance Limitations
Another significant restraint for the lithium-ion battery market relates to technological and performance limitations that could hinder broader adoption and application versatility.
While lithium-ion batteries offer high energy density compared to traditional battery technologies, there are ongoing efforts to further improve energy storage capacity.
Current energy density levels limit the range and duration of electric vehicles and constrain the scalability of energy storage systems for grid applications.
Energy Storage Systems (ESS), and Renewable Integration
The expansion of renewable energy installations, such as solar and wind farms, necessitates reliable energy storage solutions to manage intermittency and stabilize the grid.
Lithium-ion batteries are well-suited for grid-scale energy storage due to their rapid response times, scalability, and ability to charge and discharge efficiently.
Energy storage systems equipped with lithium-ion batteries enable utilities to implement demand response programs and peak shaving strategies. These capabilities help optimize energy usage, reduce reliance on fossil fuels during peak demand periods, and support grid stability.
Portable Electronics and Consumer Devices
The proliferation of portable electronics and consumer devices continues to drive demand for compact, lightweight, and high-performance batteries. Lithium-ion batteries are favored for their energy density, long cycle life, and reliability, making them ideal for powering a wide range of electronic gadgets.
Opportunities exist for innovations in battery form factors and integration into wearable technology, Internet of Things (IoT) devices, and other emerging applications that require efficient energy storage solutions.
Advancements in Recycling and Circular Economy
As the volume of end-of-life lithium-ion batteries increases, opportunities exist in developing efficient recycling technologies to recover valuable materials such as lithium, cobalt, and nickel.
Recycling not only conserves natural resources but also reduces environmental impact and supports a circular economy approach. Repurposing spent batteries for secondary applications, such as energy storage for residential or commercial use after EV or consumer electronics applications, presents economic and environmental benefits.
The market is fairly consolidated in nature, with a limited number of global players dominating the scene. However, despite the absence of many players, the market is intensely competitive, given the demand performance parameters required by clients.
Companies are investing heavily in research and development to enhance energy density, improve safety features, increase lifespan, and reduce production costs of lithium-ion batteries. Innovations such as solid-state batteries, silicon anodes, and advanced cathode materials are areas of intense focus to differentiate products and gain market share.
Key Industry Developments
In Jan 2024, the creation of Arcadium Lithium, the biggest merger in the lithium industry's history, by combining Livent and Allkem. This new entity strengthens its position as a major lithium producer across various product segments.
In Oct 2023, BatX Energies highlighted the critical role of recycling lithium-ion batteries to support India's expanding electric vehicle (EV) industry sustainably. Founded in 2020, BatX Energies specializes in reclaiming and recycling essential Earth metals such as lithium, cobalt, nickel, and manganese from discarded lithium-ion cells, vital for battery production.
In Oct 2023, Japanese researchers achieved a significant breakthrough in lithium-ion battery technology by developing batteries that eliminate the need for cobalt, a costly and limited resource commonly used in commercial lithium-ion batteries. Their innovative approach involves utilizing a blend of elements including lithium, nickel, manganese, silicon, and oxygen in the electrodes. These experimental batteries boast impressive characteristics, being 60% more energy-dense and more powerful with a voltage rating of 4.4 volts.
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Attributes |
Details |
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Forecast Period |
2024 to 2031 |
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Historical Data Available for |
2019 to 2023 |
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Market Analysis |
US$ Billion for Value |
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Key Regions Covered |
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Key Countries Covered |
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Key Market Segments Covered |
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Key Companies Profiled |
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Report Coverage |
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Customization & Pricing |
Available upon request |
By Battery Type
By Voltage
By Product Type
By Operation
By End User
By Region
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Growing adoption of electric vehicles remains a key driver for market growth.
The market is estimated to record a CAGR of 18.2% during the forecast period.
Asia Pacific to account for the notable market share.
A few of the leading industry players in the market are SK Innovation Co., Ltd., Panasonic, and LG Chem.
The proliferation of portable electronics and consumer devices presents a key opportunity for the market players.
