A market tracker forecasted that the global electric vehicle battery market will grow rapidly to $616 billion by 2035. The production in China is expected to shrink sharply due to the EV policy changes in the US and Europe.
According to SNE Research’s report, an energy market tracker based in Seoul, the projection is a fivefold rise from the $121 billion that was estimated for this year.
Globally, the demand for EV batteries is predicted to grow from 687 gigawatt-hours (GWh) in 2023 to 5.3 terawatt-hours (TWh) in 2035.
The report stated that the combined production capacity for the global top six battery manufacturers, including South Korea’s LG Energy Solution and Samsung SDI, will likely be 5 TWh by 2035.
The report stated that North America will account for 31% of global EV battery production. This is a sharp increase from the current 6% because battery manufacturers are increasing production in the region in order to qualify for U.S. Tax Credits under the US Inflation Reduction Act.
As the European Union pushes for similar policy changes to promote their local EV market, production in Europe is also expected to rise from 12% to 27%.
This will reduce the production in China to about half in 2035 compared to 75% in 2022. The report stated that by 2035, EVs would represent 80 million cars or 90% of the total number of vehicles sold worldwide.
In 2017, EVs made up about 13% of the total vehicle market, an increase from 1% between 2015-2017. The demand for EV batteries has risen to 482 GWh, up from 28 GWh during the same time period.
The research outlet stated that solid-state batteries (a new generation cell being developed by battery manufacturers) will account for 10-13% of the secondary cell market by 2035.
Around 2030, it is expected that commercial production will begin in earnest. By then, the production capacity should reach 950 GWh.
Solid-state batteries are gaining attention because they offer lower fire hazards than lithium-ion batteries, which use liquid or gel electrolytes. The vehicles also have a greater energy density, which allows for a longer range.