Secondary Battery Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The secondary battery market was valued at USD 87.82 billion in 2019, and it is anticipated to reach USD 220 billion by 2027, registering a CAGR of more than 15% during 2022-2027. The outbreak of COVID-19 is expected to hamper the market's growth in the short term due to the global economic slowdown and drop in sales of consumer electronics. The market is expected to revive with the widespread availability of vaccines and the opening up of trades and markets across the world. Declining lithium-ion battery prices and increasing adoption of electric vehicles are the major factors driving the market. On the other hand, the demand-supply mismatch of raw materials is likely to hinder the market growth.

Key Highlights

• The lithium-ion battery is expected to dominate the market during the forecast period, majorly due to its favorable capacity-to-weight ratio. Moreover, other factors boosting lithium-ion battery adoption include better performance, higher energy density, and decreasing price.
• The development of new and advanced battery chemistries is likely to create immense opportunities for the global secondary battery market.
• Asia-Pacific is expected to be the largest market, with the majority of the demand coming from China, Japan, and India.

Key Market Trends

Lithium-ion Battery Technology to Dominate the Market

• Among different types of battery technologies, lithium-ion battery (LIB) is expected to dominate the secondary battery market in the latter part of the forecast period, majorly due to its favorable capacity-to-weight ratio. Also, other factors that play an important role in boosting the LIB adoption include better performance, higher energy density, and decreasing price.
• Due to its high energy density, the price of lithium-ion batteries decreased considerably from USD 668/kWh in 2013 to USD 123/kWh in 2021, making it a lucrative choice among all the batteries.
• Lithium-ion batteries have traditionally been used mainly in consumer electronic devices, such as mobile phones, notebooks, and PCs. Still, they are increasingly being redesigned for use as the power source of choice in hybrid and the complete electric vehicle (EV) range, owing to factors, such as low environmental impact, as EV does not emit any CO2, nitrogen oxides, or any other greenhouse gases.
• Moreover, LIB manufacturing facilities are majorly located in Asia-Pacific, North America, and Europe. Major market players, such as BYD Company Limited and LG Chem Ltd, have plans to set up new manufacturing facilities in the Asia-Pacific region, primarily in India, China, and South Korea.
• Therefore, based on the above-mentioned factors, lithium-ion battery technology is expected to dominate the secondary battery market during the forecast period.

Asia-Pacific to Dominate the Market

• The Asia-Pacific region has multiple growing economies with substantial natural and human resources, with China and India expected to be major investment hotspots for secondary battery companies in the coming years, on account of policy-level support from the governments for both renewables and EVs and a growing middle-class population creating demand for consumer electronics.
• India has been witnessing a surge in manufacturing batteries locally, owing to the government’s thrust on e-mobility. The Indian government aims to achieve a 30% electric fleet by 2030 and has been formulating policies and programs to achieve the target, such as, in 2021, the government amended the ongoing FAME-II (Faster Adoption and Manufacturing of Electric Vehicles-II) scheme to increase the subsidy rate for electric vehicles from INR 10,000/kWh to INR 15,000/kWh to reduce the gap between petrol-powered two-wheelers and electric powered.
• China was the largest electric car market and sold more than 1.16 million electric vehicles, accounting for almost 40% of the global electric car sales in 2020, and it is expected to remain the world's largest EV market. The adoption of EVs in the country is further being propelled by the development of charging infrastructure. According to the IEA, China aims to deploy 1,200 stations for swapping batteries and 500,000 publicly accessible chargers in order to serve 5 million EVs by 2020. Apart from EVs, the increasing penetration of telecommunication services indicates a high demand for secondary batteries.
• Similarly, in Japan, 5G services started in 2020, and an increasing number of subscribers are likely to switch to 5G during the forecast period, thus, resulting in a surge of demand for 5G towers, thereby a surge in demand for secondary batteries.
• Therefore, based on the above-mentioned factors, Asia-Pacific is likely to dominate the secondary battery market during the forecast period.

Competitive Landscape

The secondary battery market is highly fragmented. Some of the major players include Contemporary Amperex Technology Co. Limited, BYD Co. Ltd, Duracell Inc., EnerSys, and Tesla Inc.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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