Increase in EV sales to drive global $51.6bn Li-ion battery materials market

A new report released by research firm Frost & Sullivan states that the global market for Li-ion battery materials will record a 15.6% compound annual growth rate between 2021 and 2027.

The global Li-ion battery materials market is expected to generate $51.60 billion in revenue by 2027 from $18.75 billion in 2021, according to the study.

Driving the market growth is the uptake in electric vehicles, increasing consumer preferences toward electric vehicles, advancements in battery chemistries and the continued enactment of policies supporting energy storage market expansion.

Gautam Rashingkar, Chemicals, Materials & Foods Industry Analyst at Frost & Sullivan, said: “Government incentives and subsidies for EVs, especially in Europe, increasingly stringent regulations and legislations pertaining to CO2 emissions, and competitive product offerings continue to be the primary drivers of global EV sales.“

Europe is expected to record an aggressive growth in battery and materials manufacturing to account for a third of the global market by 2027, according to the report.

Have you read?
E.ON connects third mobile storage system under IElectrix project
Toyota targets 50% reduction in EV battery costs by 2030
The US expands energy storage capacity deployment by 162%

However, the Asia Pacific region is expected to continue dominating the market and generate the highest revenue compared to other regions. China leads the demand and supply of all of the key battery materials, accounting for over 85% of the total global supply of cathode materials, anode materials, electrolytes, and separators.

Rashingkar, added: “Additionally, the continued push for longer-range vehicles and higher-energy-density batteries entails a shift toward higher nickel content cathode chemistries, partial replacement of graphite with silicon composites in anodes, incorporation of functional additives in electrolytes, increasing demand for thinner, high thermal-resistance separators, and the need for safer binder materials over the medium term.

“Characterized by the rapid evolution and adoption of chemistries to materialize gains in energy density, the cathode materials segment will be a key contributor to the overall market growth. To ensure supply security and strike a balance in cost and driving ranges, leading original equipment manufacturers (OEMs) are expected to opt for an optimized chemistry mix comprising lower-cost LFP batteries, higher-energy-density NCM batteries, and low-cobalt, high-nickel NCM batteries.”

To take advantage of the growth opportunities within the market, stakeholders should

• Develop advanced battery chemistries composed of lower cobalt content and higher quantities of relatively more abundant nickel, i.e., nickel-rich cathode materials characterized by higher energy density, power capability, longer lifecycle, and improved thermal stability.

• Strengthen supply and footprint in Europe by investing in facilities, especially in Poland, Hungary, Finland, and Germany, where major battery manufacturing facilities are expected to come online.

• Engage in collaborative partnerships to form strategic licensing agreements with leading manufacturers, enabling a wide range of IP-protected technologies to develop highly customized and specific requirements.

• Develop effective recycling processes and infrastructure in collaboration with OEMs by partnering with recycling companies to ensure access to critical raw materials like cobalt, nickel, and copper.

Find out more about the report