Lithium Ion Battery Market Analysis

Industry Analysis

In 2016, the global lithium ion (Li-ion) battery market outlook was estimated at USD 22 billion. This market is heavily influenced by growing eco-friendly solutions for vehicles and power storage & backup requirements. The rapidly evolving need for li-ion batteries in grid storages, electronic devices, and electric & hybrid vehicles is expected to foster its demand in the coming years.

Li-ion batteries are compact, safe, rechargeable and offer high density. Their increasing use in the transportation, electronic, manufacturing, and solar power industry are the major factors responsible for the growing demand. This demand is also influenced by its application in medical equipment.

It is commonly used in consumer electronic devices such as mobile phones, laptops, tablets and digital cameras due to its low-cost, energy efficiency, long-life, and light weight features. These features are expected to drive the market for electronic devices, thereby enhancing the market for li-ion batteries.

The greenhouse gases emitted from fuel run vehicles are a growing environmental concerns. Governments in countries such as the U.S, the UK, and France have adopted stringent environment norms against emissions. Thus, owing to emission reduction plans by governments there is a shift from fuel run to hybrid & electric vehicles. Such policies are expected to play a crucial role in shaping the market for li-ion batteries.

Product Insights

Manufacturers took up extensive R&D for developing batteries of high quality and productivity. Li-ion batteries can remain stable and tolerate elevated temperatures leading to the high demand in this sector. Lithium cobalt oxide and lithium nickel manganese cobalt batteries occupied larger market shares in 2016.

In 2016, Lithium Cobalt Oxide (LCO) segment type occupied the largest share. Lithium cobalt oxide (LCO) batteries use cobalt and graphite carbon, resulting in a very high battery density. Its manufacturing cost is also very reasonable due to which there was a rise in its market share in 2016. This product is used in mobile phones, digital cameras, and laptops.

The share of Lithium Nickel Manganese Cobalt (Li-NMC) type is expected to become greater over the coming years due to its low cost, long life span, and high density. Nickel and manganese combination provides the necessary accuracy and productiveness to the batteries. Li-MNC batteries are used in power tools, electric bikes, and electric powertrains.

Lithium iron phosphate (LFP) type is anticipated to grow during the projection period as it is known to provide safety devices with long life span. The market is expected to be driven by the demands of stationary and portable applications which need high current loads and tolerance levels.

Power Capacity Insights

The lithium-ion battery power capacities are segmented into four categories, namely, 0 to 3000mAh, 3000 to 10000mAh, 10000 to 60000mAh, and the more than 60000mAh. The 0 to 3000mAh power capacity type held the largest market share in 2016. This type has a wide range of applications in consumer electronics such as digital cameras, portable CD players, DVD players, camcorders, smartphones, power tools, power banks, toys, tablets, and GPS thus, resulting in huge demand.

The 10000 to 60000mAh type are used in high power capacity requiring fields. They are used in robots, marine industry, electric vehicles, telecommunication devices, energy storage systems, military applications, satellites and other industrial applications.

Application Insights

In 2016, li-ion battery market size was highest for consumer electronics applications. A high reliability and performance rate attributed to the use of li-ion batteries in laptops, tablets, and smartphones  is expected to increase their demand.

Energy storage systems have also augmented the growth of li-ion batteries due to the rise in off-grid installations. Off grid solar systems are independent electricity utility systems that provide electricity in areas without electricity access. The rise in the demand for electric vehicles as an eco-friendly solution has contributed to the growth of automotive industry thereby increasing the li-ion battery demand.

End-Use Landscape

The end-use landscape entails a list of current and prospective consumers prevailing across the regions. This section provides company addresses, contact details, products, and regional presence of companies who are purchasing or are likely to purchase advanced energy storage systems over the coming years. Some leading consumers of lithium ion battery industry are Panasonic Corporation (Japan), LG Chemicals (South Korea), Valence Technology, Inc. (The U.S.) and Toshiba Corporation (Japan).

Regional Insights

The Asia Pacific (APAC) region is projected to have the highest growth in the market during the forecast period on account of demand from countries such as Japan, China, Thailand, and India. The products applications are more in the consumer electronics and automotive industry.

The growth is expected to be greater in the consumer sector where the demand for mobiles, tablets, and laptops is rising. There is a rising environmental concern due to greenhouse gases emitted from fuel run vehicles. This is expected to increase the demand for electric vehicles, thereby leading to the growth in the automotive sector in the Asia Pacific region.

The U.S. and Mexico in North America are expected to grow at a significant rate owing to rise in electric vehicle and consumer electronic sales. According to the Global EV Outlook 2017, the U.S. had the second largest electric car sales in 2016, China occupied the largest share.

Competitor Analysis

The global market is extremely competitive due to the presence of many small and large-scale manufacturers. The participants include companies such as Panasonic Corporation (Japan), Samsung SDI Co. Limited (South Korea), BYD Co. Limited (China), BAK Group (China) and LG Chemicals Limited (South Korea).

In September 2016, Panasonic Corporation announced the development of Flexible Lithium-ion Battery. It has resistant to discharging caused by bending and twisting and can, therefore contribute to longer operating time to card type and wearable devices such as fitness trackers and smart watches.

In October 2016, LG Chemicals, South Korea's leading advanced battery manufacturer announced that it would start the construction of electric vehicles production plant in Poland. This large scale automotive lithium-ion battery plant is expected to have a production capacity of approximately 100,000 batteries per annum for automotive application in Europe.

Please note: This is not an exhaustive list of companies profiled in the report.