The demand for lithium-ion battery is growing as compared to other batteries in the global market. The growth of this market is propelled by the increase in demand for EVs, strict government mandates on fuel economy, growing demand for smart devices and other consumer electronics, and development toward the enhancement of lithium-ion batteries. Further, the reduction in the price of lithium-ion batteries is also encouraging automobile manufacturers to invest more in EVs.
The global lithium-ion battery market size is estimated to be valued at USD 44.2 billion in 2020 and is projected to reach USD 94.4 billion by 2025; it is expected to grow at a CAGR of 16.4%.
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Major factors such as an increase in demand for plug-in vehicles, growing need for automation and battery-operated material-handling equipment in industries, rising demand for smart devices and other industrial goods, increasing number of R&D initiatives by manufacturers for improvements in Li-ion batteries, and high requirement of lithium-ion batteries for various industrial applications.
The lithium-ion battery market for the industrial segment is expected to witness significant growth during the forecast period. Industrial equipment requires batteries having high energy density and longer backup, which are required to improve efficiency and performance of such equipment. The use of lithium-ion batteries provides a competitive edge to such equipment over electricity-powered equipment, in terms of carbon emissions and safety in underground environments. Moreover, Rapid infrastructural growth is boosting the demand for construction and mining equipment, which is further leading to the growth of lithium-ion batteries in the industrial sector.
Lithium-ion batteries with a capacity range of 0 mAh to 3,000 mAh accounted for the largest size of the market in 2019. This range is the most popular and highly demanded in the market. This range is used majorly in consumer electronics, and as the demand for consumer electronics is huge, the market for this power capacity is also large. Around 90% of consumer applications have the power capacity in the range of 0–3000 mAh since low-capacity batteries are potentially longer-lasting power sources for consumer electronics and are light in weight and portable.
The lithium-ion battery market in APAC is expected to grow at the highest CAGR during the forecast period. The automotive, consumer electronics, and power industries are expected to drive the demand for advanced batteries in the region. Also, China and Japan are the world’s second- and third-largest countries, respectively, in the electric vehicles market. Leading players contributing to the growth of the region are JAC Motors (China), BYD Co. Ltd. (China), BAIC Group (China), SAIC Motor Corporation Limited (China), Nissan Motor Company Ltd. (Japan), Mitsubishi Motors Corporation (Japan), and Toyota Motor Corp. (Japan) among others. Continuous development in the consumer and automotive sector has led to increased application of lithium-ion battery. The products of these industries require high power capacity with safety and a low rate of pollution. Lithium-ion batteries are capable of fulfilling these requirements of consumer and automotive industries. This makes them one of the highly adopted batteries in new products.
