Lithium-ion cell market to hit $400bn by 2035
Cette publication existe aussi en Français
The lithium ion battery cell market will reach over US$400 billion by 2035 according to the latest report from analyst IDTechEx
While there has been strong growth in the stationary battery sector, electric vehicles remain the key driver behind the lithium ion cell market, and electric cars will be the largest market for Li-ion batteries over the next 10 years.
The market report, “Li-ion Battery Market 2025-2035: Technologies, Players, Applications, Outlooks and Forecasts” highlights some regional concerns over the rate of EV adoption in 2024, sales of electric vehicles grew rapidly in 2022 and 2023, and the medium-long-term outlook for EV adoption remains strong.
Despite the EU critical materials act and the US Inflation Reduction Act (IRA) that are intended to stimulate local battery productions, China and Chinese companies continue to dominate the global supply chain, particularly for anodes and electrolytes (see chart)
Cobalt-free lithium battery tops 800Wh/kg
In Europe, the reality of scaling production rapidly, competing with established Asian players, and some slower than expected demand has inhibited recent investment and expansion plans says Dr Alex Holland, Research Director at IDTechEx.
2023 and 2024 have also seen substantial declines in battery prices, driven by lower raw material prices, production overcapacity, and strong competition throughout the supply chain. While this is beneficial to consumers, it has also impacted margins and exacerbated the difficulty of new entrants succeeding in the Li-ion market.
There has been significant growth in the number of gigafactories brought online as well as those being planned and announced. Much of this has been driven by incumbent manufacturers such as CATL, BYD, LG Energy Solution, SK Innovation, and Samsung SDI, along with a number of fast-growing Chinese manufacturers.
IDTechEx estimates that the majority of cell production is located in China, a trend common across the Li-ion value chain where Chinese companies control much of the market for anodes, cathodes, electrolytes, separators, and copper current collectors.
To reduce reliance on a single region and develop domestic battery manufacturing capabilities, Europe and North America are attempting to foster domestic supply chains. In the US, the IRA led to a flurry of gigafactory and investment announcements.
Prior to the IRA, IDTechEx estimated that approximately 600 GWh of battery cell capacity would be located in North America by 2030 with this figure growing to 850 GWh in IDTechEx’s latest analysis.
The anode and cathode materials, which ultimately define the performance of a Li-ion battery, continue to evolve. At the cathode, a shift toward LFP has been driven by China and a broader attempt to bring down battery price points. Numerous battery manufacturers and automotive manufacturers outside of China are now looking to develop LFP-based batteries or other low-cost solutions.
Nevertheless, the high energy density of high-nickel NMC / NCA / NCMA type cathodes means it will remain a key chemistry for long-range and performance-oriented electric vehicles or other applications requiring high energy densities and long runtimes.
Cathode prices, including for LFP and NMC materials, have fallen substantially from early 2023 due to sharp reductions in lithium and raw material prices, as well as overcapacity and competition.
At the anode, new materials, especially silicon-oxide and silicon-carbon composites, continue to garner interest due to their potential to improve energy density despite issues regarding cycle life and lifetime. The potential to establish supply chains for silicon anodes outside of China represents another potential benefit, with anode production particularly concentrated in the region. However IDTechEx estimates close to 99% of total anode material used in Li-ion batteries is graphite.
Developments and innovations continue to be made in Li-ion anode and cathode materials, manufacturing, cell design, and pack design, all contributing to improved performance and price points and the general positive outlook for EVs. However, significant opportunities exist in other applications and markets. These include a variety of different vehicle classes, from large electric trucks and mining vehicles to electric 2- and 3-wheelers, through to grid-scale and residential battery energy storage systems, each with their own performance priorities, not all of which can be satisfactorily met by current generation batteries.
The stationary sector has seen rapid year-on-year growth due to increased deployment of renewable energy onto electricity grids and particularly fast drops in stationary battery prices. Longer lifetime and higher capacity containerized storage systems offer a glimpse into the continued innovation going into Li-ion battery systems.
If you enjoyed this article, you will like the following ones: don't miss them by subscribing to :
