Frost & Sullivan: Li-ion battery materials market to reach $51.60B by 2027 from $18.75B in 2020; 15.6% CAGR
12 September 2021
Frost & Sullivan projects that the global Li-ion battery materials market will reach $51.60 billion by 2027 from $18.75 billion in 2020 at a 15.6% compound annual growth rate (CAGR). The advancements in battery chemistries and technologies, upsurge in electric vehicle (EV) sales, evolving regulatory scenario, and increasing consumer preferences toward EVs are expediting market growth worldwide.
Asia-Pacific (APAC) dominates the market and continues to be the highest revenue-generating region. China leads the demand and supply of all of the key battery materials, accounting for more than 85% of the total global supply of cathode materials, anode materials, electrolytes, and separators. However, Europe is expected to witness an aggressive expansion in its Li-ion battery and materials manufacturing capacity. It is slated to account for nearly a third of the global Li-ion battery manufacturing capacity by 2027.
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. 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.—Gautam Rashingkar, Chemicals, Materials & Foods Industry Analyst at Frost & Sullivan
To tap into the growth opportunities, Frost & Sullivan suggests market participants 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 such as cobalt, nickel, and copper.
Global Li-ion Battery Materials Growth Opportunities is the latest addition to Frost & Sullivan’s Chemicals, Materials & Foods research and analyses available through the Frost & Sullivan Leadership Council.
I believe that they may be underestimating the market. What I believe will happen is that cost of battery electric vehicles will reach a tipping point where it does not make much sense to buy an ICE vehicle. GM and Ford along with a number of European manufacturers are betting on this and will offer an increasing number of battery electric vehicles. The new Ford Lighting F-150 is a good example of this. The inital cost is not much more than the ICE version and would be much more useful as a contractor vehicle.
Posted by: sd | 12 September 2021 at 05:47 PM