The global battery market was valued at USD 118.57 billion in 2020 and is expected to grow at a CAGR of 14.0% during the forecast period. The market for battery is expected to witness significant growth over the eight years owing to the development of the vehicle and motorcycle industry, energy storage applications. Increasing demand for UPS in industrial sectors such as oil and gas, chemical, and healthcare is expected to propel demand.
Increasing application scope ranging from electric vehicles and energy storage has driven the need for innovation in this industry which has led to the development of advanced lead-acid batteries. Development of the automotive industry in Indonesia, Mexico, India, Vietnam, and Thailand is expected to propel industry size.
Companies have undertaken customized research in order to create a product that perfectly matches the respective regional needs. Customized product offering and proper product placement are some of the critical success factors in the industry. Diversification of product portfolio along with support at each step of the value chain is a key concern for industry participants.
Manufacturers, especially those operating in Asia Pacific countries, have expanded their product portfolio, manufacturing, and distribution capabilities in order to cater to rising demand from tier 2 as well as tier 3 cities. In order to gain increased market share, they are increasing their regional footprint by infusing advanced technologies in their products, spending more on marketing and advertisement, and are now promoting their brands aggressively.
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High penetration of vehicles in various countries including Mexico, Germany, the U.S., Malaysia, China, and India will augment industry expansion. Rising disposable income coupled with increasing penetration of market players including Exide Technologies and Johnson Controls is expected to drive the demand in the automotive sector over the forecast period.
The lithium-ion battery segment is expected to penetrate lead-acid battery applications including electric vehicles, plug-in electric vehicles, storage, and automobiles thus, gaining a significant market share by 2028 High demand for portable electronics including smartphones, LCD displays, tablets and wearable devices such as fitness bands propel battery industry growth.
The market is primarily segmented on the basis of type, end-use, and region.
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The lead-acid battery segment accounted for 37.4% of the global revenue share in 2020. High use of UPS devices in the healthcare, chemical, and oil & gas sectors for continuous power supply will propel lead-acid market battery demand. The battery is used in critical applications on account of high reliability and low cost. However, the lithium-ion battery segment is expected to capture a significant portion of the lead-acid battery demand over the forecast period on account of low energy density and lightweight.
The lithium-ion battery is commonly used in devices such as mobile phones, digital cameras, and power tools. Moreover, demand for the lithium-ion battery segment in the manufacturing, solar power, and railway industries is also expected to increase with the growing demand for power backup and storage. Lithium-ion batteries are costlier than lead-acid batteries; however, have a higher lifespan when compared to a lead-acid battery.
The worldwide registration of electric vehicles is anticipated to increase significantly over the forecast period. A rise in the availability of charging outlets and financial incentives has emerged as a crucial factor for the growth of the electric vehicle market. The lower running cost of EVs compared to that of the conventional ICE-operated vehicle is also expected to bolster the market growth for the lithium-ion battery segment.
The automotive segment is expected to grow at a CAGR of 14.6% over the forecast period. Batteries are widely used in automotive applications including forklifts, golf carts, and industrial cleaners. Increasing demand for battery in forklifts on account of their low cost, reliability, and well-established supply chain is expected to fuel demand.
Increasing automotive production mainly in China, Indonesia, Mexico, the U.S., Germany, South Korea, Japan, Malaysia, and Taiwan is a major driver for market growth. In addition, rapid economic growth, increasing government spending, advancements in road infrastructure coupled with increasing inclination of consumers towards personal conveyance are expected to propel market growth.
The growth of the global energy storage systems market is estimated to amplify the consumption of industrial batteries over the next couple of years. Grid energy storage systems are expected to compete with traditional or conventional power generation, transmission & distribution systems.
As the growth of this industry gains momentum, new types of business models are expected to be invented and adopted by manufacturers to implement and operate storage assets. This is estimated to further impact the operational ability thus allowing grids to work in a more reliable and cost-effective manner.
Asia Pacific battery market is expected to witness the highest growth of 14.4% over the projected period. The robust manufacturing base of lead-acid batteries in China, Japan, and India along with the commitment of governments towards infrastructure development is expected to increase lead acid battery revenue share over the coming years.
Growing FMCG companies in India, China, and Singapore are expected to augment market share in the near future. In addition, rapid industrialization, increasing government infrastructure spending along increasing FDI will promote market growth.
Favorable government policies for infrastructural development at the domestic level through the National Infrastructural Plan (NIP), are expected to promote market growth in North America. GDP growth coupled with rising industrial output will drive various sectors such as medical, electronics, industrial controls, furniture, and appliances in the U.S. The above-mentioned trend is projected to promote market growth over the coming years.
Europe has been one of the leading producers of vehicles in the past and will continue its dominance in this sector over the upcoming years. The presence of major automotive manufacturers including Audi, BMW, Mercedes Benz, Jaguar, Aston Martin, Volkswagen, Volvo, Fiat, Ferrari, Lamborghini, and Porsche in the region will augment the automotive industry expansion, which in turn will drive the demand for battery over the forecast period.
The leading players in the Battery market include BYD Co. Ltd., Duracell International, Inc., Eveready Industries India Ltd., Johnson Controls, Exide, LG Chem Ltd., Sony Corporation, NEC Corporation, Panasonic Corporation, Toshiba Corp., Samsung SDI Co., Ltd., EnerSys.
These players are expanding their presence across various geographies and entering new markets in developing regions to expand their customer base and strengthen their presence in the industry. The companies are also introducing new innovative battery products in the market to cater to the growing consumer demands.
The key players opting for product launch as a secondary growth strategy to enhance their presence in the global battery industry. Product launch held ~56% of the total strategies adopted by the overall key players in the market. The companies adopting product launch as its primary strategy include BYD, Duracell, LG Chem Ltd., Sony Corporation, Panasonic Corporation, Toshiba Corp., Samsung SDI Co., Ltd., EnerSys.