September 2024
The automotive battery market size to rise from USD 69.98 billion in 2023 to reach an estimated USD 327.46 billion by 2032, at increasing CAGR of 18.72% from 2023 to 2032.
Unlock Infinite Advantages: Subscribe to Annual Membership
Automotive batteries serve as vital electrical components capable of storing and generating electricity. They play a crucial role in powering vehicle engines and ignition systems during start-up, while also acting as voltage regulators when the alternator is inactive, supplying power to various electronic devices such as lights and radios.
The market growth is primarily attributed to the increasing global demand for efficient and environmentally friendly transportation solutions, particularly with the rise of electric vehicles (EVs). Various advertising campaigns and governmental regulations aimed at promoting clean energy have brought attention to consumer concerns surrounding traditional vehicles, such as fuel dependency and emissions. These factors have contributed to a shift in consumer preferences towards electric vehicles, thereby driving the demand for automotive batteries.
The growing capacity of batteries on a global scale is expected to facilitate economies of scale within the automotive battery industry, further fueling market growth. As technology advances and production efficiencies improve, the automotive battery market is poised to witness significant expansion in the foreseeable future.
Governments worldwide are increasingly adopting stringent emissions reduction targets, with the promotion of electric vehicles (EVs) emerging as a key strategy to meet these objectives. For instance, the European Union has set ambitious goals to slash greenhouse gas emissions by 55% by the year 2030, while China aims for 25% of all new car sales by 2025 to be electric. The widespread adoption of lithium-ion batteries, which power the majority of electric vehicles, has ushered in notable advancements in energy density, charging efficiency, and overall performance. These improvements have made electric cars more appealing and efficient options for consumers.
The surge in demand for electric vehicles is expected to drive further innovations in battery chemistry and materials, necessitating the development of safer and more efficient vehicle batteries. Many leading automotive manufacturers are forging long-term partnerships with battery manufacturers to bolster their supply chains and enhance production capacities. For instance, Panasonic Holdings has announced plans to augment electric car battery production capacity at its Nevada factory, which it shares with Tesla, by 10% within a three-year timeframe starting from June 2023. Additionally, Panasonic Energy intends to add a 15th production line at Gigafactory Nevada to accommodate this expansion. Concurrently, various companies like Excellent are actively engaged in the research, development, and production of automotive batteries.
In another significant development, Stellantis NV and Samsung SDI have unveiled plans to invest over $2.5 billion in a new battery venture located in Kokomo, Indiana, signaling a substantial commitment to the burgeoning battery market. As the electric vehicle market continues its rapid expansion, the demand for high-performance batteries is poised to soar, presenting lucrative opportunities for companies operating in this sector.
The Asia Pacific region is poised to witness the most rapid escalation in vehicle battery prices, primarily driven by the surging demand for electric vehicles (EVs) and commercial vehicles. With a concentration of the majority of battery manufacturers and vehicle original equipment manufacturers (OEMs), the region stands at the forefront of this burgeoning market. China, in particular, holds a dominant position as both the largest producer and consumer of electronics globally.
The region's escalating demand is further fueled by ambitious sales targets, favorable regulations, and urban climate initiatives. Notably, China has implemented quotas mandating that a minimum of 10% of all new vehicle sales must comprise electric or hybrid vehicles, as part of efforts to curb emissions. Additionally, policies such as limiting the monthly quota for electric car sales in cities like Beijing aim to incentivize the transition to electric vehicles.
China also boasts approximately 80% of the world's lithium-ion battery production capacity, giving it a decisive edge in the battery market competition. Moreover, the country controls crucial aspects of battery materials, including the extraction and processing of lithium and graphite, essential elements used in battery production. As a result, numerous stakeholders in the region are devising strategic initiatives to secure their supply chains and capitalize on market opportunities.
For Instance,
The burgeoning demand for automotive products across diverse applications in countries like South Korea, India, Malaysia, and Indonesia is poised to drive the region's growth trajectory throughout the forecast period.
The vehicle battery market has witnessed consolidation, with key players that are actively engaged in enhancing their products and services to broaden their customer base.
Moreover, several major players are strategically expanding their market presence through initiatives such as production and service expansion, as well as through mergers and collaborations with other industry players. For instance, in March 2023, the United States and Japan inked a crucial agreement regarding the trade of essential materials utilized in electric vehicle (EV) batteries, aimed at securing the battery supply chain.
In another significant development, Li-Cycle Holdings Corp. entered into a definitive agreement to establish a global lithium-ion battery recycling partnership with KION Group, underscoring the industry's commitment to sustainability and resource conservation. Additionally, plans were unveiled to construct a new lithium-ion battery facility in France, further bolstering efforts toward environmentally responsible battery management.
Furthermore, Morrow made a substantial investment of 20 million euros in March 2023 to support the production of lithium-ion batteries, particularly those utilizing Korean iron phosphate (LFP) technology. This strategic investment reflects the growing importance of advanced battery technologies in meeting the evolving demands of the automotive and energy sectors.
Overall, these developments underscore the dynamic nature of the vehicle battery market, with companies leveraging innovation, partnerships, and strategic investments to capitalize on emerging opportunities and address evolving industry challenges.
A car battery, also known as an automotive battery, is an essential component used to start a vehicle. Its primary function is to supply electrical current to the electric starter, which initiates the rotation of the internal combustion engine or electric motor, thereby powering the vehicle's drive system.
The vehicle battery market encompasses various factors such as battery type, vehicle type, driving mode, and geographical regions. It is segmented based on battery type into lead-acid battery, lithium-ion battery, and other battery types. Vehicle types include passenger cars and commercial vehicles, while driving modes comprise hybrid vehicles and electric vehicles. Geographically, the market is divided into regions including North America, Europe, Asia Pacific, Latin America, and the Middle East and Africa.
This segmentation allows for a comprehensive analysis of the automotive battery market, considering the diverse preferences, technological advancements, and regulatory frameworks across different regions and vehicle categories.
By Battery Type
By Vehicle Type
By Drive Type
By Geography
September 2024
September 2024
September 2024
September 2024
Dr. Arjun Patel is a distinguished expert in the automotive industry, holding advanced degrees in Automotive Engineering and Mechanical Engineering. His expertise spans automotive market dynamics, technological advancements, and sustainable practices. Dr. Patel excels in conducting in depth research and analysis on market trends, consumer preferences, and the economic implications within the automotive sector. He is renowned for his insightful publications on topics such as electric vehicles, autonomous driving technologies, and the evolution of sustainable transportation solutions. Dr. Patels research contributions have significantly advanced understanding in the field, earning him recognition as a leading authority in automotive research and analysis.
We offer automotive expertise for market projections and customizable research, adaptable to diverse strategic approaches.
Contact Us