Lithium-Ion Battery Market Is Moving Into Surge Mode

Although electric vehicles are not mainstream yet, in 2022, the EV industry reached an inflection point and is witnessing exponential growth. 

Importance of lithium-ion batteries in the next decade

Lithium-ion batteries work similarly to other batteries in most aspects. However, the significant difference is that the electrodes in lithium-ion batteries do not get strongly affected by the chemical reactions. Lithium-ion batteries are known for their impressive energy density, which allows them to draw the power into small, lightweight packages. They offer short charging and can run a high number of discharge cycles compared to nickel-cadmium or nickel-metal hybrid batteries. The largest market for lithium-ion batteries has traditionally been portable electronic devices, but there is an extensive growth in demand for lithium-ion batteries in other sectors like transportation. 

Forecast about lithium-ion industry and OEMs

Lithium-ion batteries have transformed the consumer electronics sector and  are beginning to power the electrification of the automotive industry. Lithium-ion batteries are a source of energy for electric vehicles. The widespread use of electric cars and plug-in hybrid electric vehicles has boosted the demand for lithium-ion batteries and this will only increase in the coming years. The increasing use of energy-efficient electric vehicles among consumers has significantly reduced pollution as well. 

Still, the question remains. Can OEM manufacturing battery supply keep up with the demand? There has been a huge scarcity in battery supply presently and it is expected to continue till 2023. The vehicle manufacturers are compelled to plan out their battery production requirements in advance before starting the production work to ensure they don’t run out of battery supply. 

Even if OEMs try to mass-produce, the quality may not be up to the mark, and it may take a long time to have high-quality mass production facilities. Many of these OEMs are planning the production of up to 50 GWh. But in reality, the battery capacity is only up to 10 GWh. Therefore, adequate high-quality battery production will not be a reality anytime soon.

Also Read:

• Impact of COVID19 and Russia Ukraine war on OEM Sector