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Global electric vehicle battery market changes by 2024
The electric vehicle market is undergoing unprecedented changes as the world becomes more environmentally conscious and technology continues to evolve. 2024 marks a new turning point for the market, with a confluence of factors shaping the future direction of the electric vehicle industry and ev battery technology. This article is about global electric vehicle battery market changes by 2024 and and projected changes in battery prices.
Global electric vehicle battery market year-on-year growth in the first half of 2024
The global electric vehicle battery market grew 19% year-on-year in the first half of 2024, with China ranking first in terms of EV battery installations, followed by Europe and the US. According to Counterpoint, the global average battery capacity for BEVs reached 64.7 kWh in H1 2024 (up 6% y-o-y), while the average battery capacity for plug-in hybrids reached 23.1 kWh (up 14% y-o-y), driven by China’s growing demand for smart electric vehicles.
Chinese companies including CATL, BYD, CALB, EVE Power, Fudi and Gotion tech currently control two-thirds of the global EV battery market, and their rapid international expansion following their success in China poses a significant challenge to other suppliers.
China’s dominance has prompted the West to impose new and additional tariffs on Chinese cars, batteries, battery components, and other Chinese-made products. in the first half of 2024, the United States will raise tariffs on Chinese electric vehicles (EVs) from 25% to 100%, increase tariffs on batteries and components from 7.5% to 25%, and impose 25% tariffs on graphite and permanent magnets, which had been previously exempted from duty. the US will also raise tariffs on Chinese electric vehicles (EVs) to 100%, and on batteries and components from 7.5% to 25% in the first half of 2024.
Global electric vehicle battery market expands, korean companies lose market share
According to SNE Research, the size of the global electric vehicle (EV) battery market (including pure electric vehicle EVs, plug-in hybrid electric vehicle PHEVs, and hybrid electric vehicle HEVs) realized significant growth from January to September this year, with total battery usage reaching 599.0 gigawatt-hours (GWh), a 23.4% increase over the same period last year.
The total market share of the three South Korean companies was 20.8 percent, down 3.4 percentage points from a year earlier, the data showed. The drop is largely attributed to aggressive overseas expansion by Chinese battery companies, which have rapidly expanded their market share.
LG EnSol maintained third place with 72.4GWh of installed capacity, up 4.3% from a year ago, for a 12.1% market share.LG EnSol’s growth was driven by steady sales in Europe and North America, such as the Tesla Model 3 and Y and the Volkswagen ID.4, as well as a significant increase in sales of the Hyundai IONIQ5 and Kona EV in Europe.
SK On achieved 28.5 GWh of installed capacity, up 12.4% from the same period last year, attributable to recovering sales of Hyundai’s IONIQ5 , EV6, EV9 and Mercedes-Benz EQA. However, its market share ranking dropped a notch to fifth place with a 4.8 percent share.
Seventh-ranked Samsung SDI achieved 23.9GWh, up 5.4%, with the result benefiting from strong sales of BMW and Rivian cars, with a market share of 4.0%.
In contrast, China’s Ningde Times (CATL) maintained its global lead with 219.6GWh of capacity, up 26.5% from a year ago, for a market share of 36.7%. BYD ranked second with 98.5GWh, up 28.0% and with a market share of 16.1%. BYD’s success is attributed to its new hybrid vehicles, which can travel up to 2,100 kilometers on a single charge, targeting both the pure electric vehicle market and the plug-in hybrid electric vehicle (PHEV) market.
AVIC Lithium CALB jumped to fourth place with 29.3GWh, up 27.0% from a year ago. Meanwhile, Japan’s Panasonic experienced negative growth, dropping 20.2% to finish at 25.7GWh and sixth place, due to falling sales of the Model 3 facelift.
EV battery prices expected to drop nearly 50% by 2026
According to a new report from Goldman Sachs Research (Goldman Sachs Research), electric vehicle battery prices will fall sooner than expected due to advances in battery technology and falling green metal prices. This trend could accelerate the popularity of electric vehicles and put them in a better position to compete with gasoline vehicles in terms of cost.
The global average battery price falls from $153 per kilowatt-hour in 2022 to $149 in 2023, and Goldman Sachs expects this figure to fall further to $111 by the end of 2024. Longer-term forecasts show that average battery prices are expected to fall to $80 per kWh by 2026, which represents a nearly 50 percent decline from 2023. At this price level, EVs are expected to achieve cost-of-ownership parity with gasoline-powered vehicles, without the need for government subsidies.
Factors behind falling battery prices
Nikhil Bhandari, co-head of Asia-Pacific natural resources and clean energy research at Goldman Sachs Research, pointed out that there are two main reasons for the rapid decline in battery prices: firstly, technological innovation, with new battery products featuring around 30% higher energy density and lower production costs. The second is the continued decline in battery metal prices, including lithium metal battery and cobalt and other key materials prices. Metal prices were high between 2020 and 2023 due to “green inflation”, but these prices are now being pulled back, driving down battery prices.
The increase in battery energy density is mainly due to optimization of the battery structure. Manufacturers are trying to simplify the production process, such as direct battery cell-to-ev battery pack, eliminating the need for a traditional modular structure, thus improving space efficiency and reducing costs.
Battery types dominating the market and future trends
Currently the market is dominated by two types of lithium-based batteries: nickel-chemical batteries, accounting for about 60% of the market share; and lithium iron phosphate (LFP) batteries, accounting for about 35% to 40%. LFP battery market share is expected to reach 45% in 2025.
Despite high hopes for new types of batteries such as ev solid state battery, their mass adoption has been delayed until later this decade due to the challenges of moving from lab scale to mass production. Meanwhile, existing lithium-based battery technologies are being optimized and are likely to continue to dominate the market in the short term.
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