Battery Performance Warranty Market Report 2026

The battery performance warranty market size has grown rapidly in recent years. It will grow from $3.25 billion in 2025 to $3.67 billion in 2026 at a compound annual growth rate (CAGR) of 13%. The growth in the historic period can be attributed to ev adoption growth, early battery degradation concerns, regulatory consumer protection norms, rising battery replacement costs, oem brand differentiation strategies.

The battery performance warranty market size is expected to see rapid growth in the next few years. It will grow to $5.91 billion in 2030 at a compound annual growth rate (CAGR) of 12.7%. The growth in the forecast period can be attributed to longer battery lifespans, declining battery cost per kwh, increased second-life battery use, growth in energy storage deployments, evolving warranty risk analytics. Major trends in the forecast period include extended battery warranty periods, standardized capacity retention benchmarks, mileage-linked performance assurance models, transferable warranties to improve resale value, integration of warranty terms with financing and leasing.

The growing demand for electric vehicles (EVs) is expected to drive the expansion of the battery performance warranty market. Electric vehicles are cars that use electric motors powered by rechargeable batteries or fuel cells instead of internal combustion engines, offering reduced emissions, improved energy efficiency, and less reliance on fossil fuels. The rising adoption of EVs is largely due to increasing environmental concerns, as EVs produce fewer emissions and help mitigate air pollution and climate change. Battery performance warranties support the adoption of electric vehicles by offering long-term reliability, making EVs more attractive to consumers and alleviating concerns about range anxiety. These warranties protect against battery degradation and replacement costs, boosting consumer confidence and encouraging wider adoption of sustainable transportation. For example, in 2024, the International Energy Agency reported that global electric car sales reached 3.5 million in 2023, marking a 35% year-on-year increase from 2022. As a result, the increasing demand for electric vehicles is fueling the growth of the battery performance warranty market.

Major players in the battery performance warranty market are developing policies like lifetime coverage, which provide long-term value and address concerns about ownership costs and battery degradation. Lifetime coverage is a warranty that ensures protection for the entire usable life of the product or the duration of ownership, including repairs or replacements as necessary. For instance, in July 2025, Tata Motors Ltd., an India-based automotive manufacturer, introduced a lifetime battery warranty for its electric vehicles, such as the Curvv EV and Nexon EV 45kWh. This warranty covers unlimited kilometers for 15 years for both new and existing owners. It reassures customers about battery longevity, tackles replacement cost concerns, and could save owners approximately 8-9 lakh over ten years. The warranty also covers manufacturing defects in the battery pack and ensures that it will retain at least 70% of its State of Health (SoH) throughout the ownership period, providing peace of mind and safeguarding the vehicle's resale value.

In May 2023, Lohum Cleantech Private Limited, an India-based lithium-ion battery recycling company, teamed up with ACKO General Insurance Limited in a partnership aimed at recycling and repurposing EV batteries covered by extended battery warranty insurance. This collaboration ensures smooth warranty claims, minimizes environmental impact, and supplies sustainable materials for new batteries. ACKO General Insurance Limited is a digital-first insurance company offering extended battery warranties for EVs.

Major companies operating in the battery performance warranty market are Tesla, Inc., General Motors Company, Bayerische Motoren Werke AG (BMW), Volkswagen Group, HyundAI Motor Company, Nissan Motor Co., Ltd., BYD Company Limited, Toyota Motor Corporation, Panasonic Holdings Corporation, LG Energy Solution Ltd., Contemporary Amperex Technology Co. Limited (CATL), Samsung SDI Co., Ltd., SK On Co., Ltd., Clarios, LLC, GS Yuasa Corporation, VARTA AG, Saft Groupe S.A. (TotalEnergies Saft), EnerSys, Exide Technologies, East Penn Manufacturing Company, Inc., Leoch International Technology Limited, Luminous Power Technologies Pvt. Ltd., Okaya Power Private Limited, FIAMM Energy Technology S.p.A., NIO Inc., Envision AESC Group Ltd.

Note that the outlook for this market is being affected by rapid changes in trade relations and tariffs globally. The report will be updated prior to delivery to reflect the latest status, including revised forecasts and quantified impact analysis. The report’s Recommendations and Conclusions sections will be updated to give strategies for entities dealing with the fast-moving international environment.

Tariffs are influencing the battery performance warranty market by increasing the cost of imported battery cells, modules, and testing equipment, which raises warranty provisioning and compliance expenses for manufacturers. Automotive and energy storage segments are most affected, particularly in regions dependent on cross-border battery supply chains such as Asia-Pacific, Europe, and North America. These cost pressures may lead to tighter warranty terms or higher vehicle and system prices. However, tariffs are also encouraging localized battery manufacturing and testing infrastructure, which can improve quality control and strengthen long-term warranty confidence.

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A battery performance warranty guarantees that an electric vehicle (EV) or energy storage battery will maintain a specified percentage of its original capacity or performance over a defined period or mileage. It provides consumers with assurance of long-term reliability, protects against premature degradation, and holds manufacturers accountable for battery quality and durability.

The primary battery types covered under a battery performance warranty include lead-acid, lithium-ion, nickel metal hydride, solid-state, and others. A lead-acid battery performance warranty ensures that the battery’s capacity, reliability, and service life remain within specified limits over a defined usage period. Coverage types include capacity retention, cycle life, product replacement, and others, with applications in automotive, consumer electronics, industrial, energy storage systems, and more, serving end-users such as original equipment manufacturers (OEMs), aftermarket providers, utilities, and others.North America was the largest region in the battery performance warranty market in 2025. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the battery performance warranty market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the battery performance warranty market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The battery performance warranty market includes revenues earned by entities through after-sales services that ensure battery reliability, performance assurance, maintenance, and replacement support. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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