Industrial Lithium-Ion Battery Market Analysis

Industrial Lithium-Ion Battery Market Analysis

The industrial lithium-ion battery industry reached USD 3.6 billion, USD 4.2 billion and USD 4.8 billion in 2022, 2023 and 2024 respectively.
 

• The LFP battery segment is predicted to reach over USD 4 billion by 2034. The LFP battery consists of iron phosphate as its cathode. The battery provides higher energy density, lower perishability and effective performance. These batteries are majorly used in EVs, industrial machines, marine and aviation. Owing to these factors many American companies such as Tesla, and Ford recently invested into LFP production facility.
   
• Owing to high demand for industrial lithium-ion batteries from different users such as automakers, consumer electronics, various companies and researchers have initiated to invest prominently to develop new technologies and are currently in early stages.
   
• NMC battery segment is expected to register at a 10.4% CAGR through 2034. Owing to these factors, different emerging firms including Lohum, InoBat recently invested into NMC production. In addition, various innovations and adoption of environment-friendly material for cathode development to prevent the energy leak and decline carbon emission.
   

The industrial lithium-ion battery market by application is segmented into military, heavy, industrial equipment, medical, marine and others. The military segment held 24.7% market share in 2024.
 

• Rising disposable income and growing adoption of portable devices the demand for industrial lithium-ion batteries are similarly rising. Industrial lithium-ion batteries are considered ideal choice in drones, GPS, smartphones and radios due to their compact and lightweight design and longer charge-discharge cycle. These drones and UAVs are widely used in military application. Thus, the military application segment is expected to cross USD 3.9 billion by 2034.
   
• Owing to increasing demand for metals such as iron, industrial minerals and other metals. The development of iron ore in FY 2023 crossed 275 million metric ton (MMT) from 258 MMT in FY 2022. This is projected to simultaneously increase the demand for mining equipment and other heavy equipment application segment. These factors is expected to led CAGR for heavy industrial equipment beyond 10.8% by 2034.
   
• Owing to rise in adoption of EV due to rising adoption of environmental friendly transportation and favorable government policies in the field, the industrial lithium-ion battery is expected to witness higher demand. For instance, more than 13.5 million of electric cars were sold globally in 2023. Thus reaching 40 million total number of electric cars on road as of 2023.
   

• The U.S. industrial lithium-ion battery market size crossed USD 1.2 billion, USD 1.4 billion and USD 1.6 billion in 2022, 2023 and 2024 respectively. Favorable government initiatives for battery makers in regional countries such as U.S. is estimated to boost the demand for market. For instance, in September 2024, government of the U.S. announced distribution of award money worth USD 3 billion to local 25 battery manufacturers to motivate indigenous battery production.
   
• Similarly, government support to boost the usage of EVs and development of batteries will enhance the growth of industrial lithium-ion batteries in developing nations such as China. For instance, Chinese government announced extension of its NEV tax reduction and exemption rule until 2027.
   
• Similarly, South Korean companies are putting significant efforts to rise industrial lithium-ion battery development. For instance, SK On a subsidiary of SK group in South Korea introduced strategic initiative to ease supply of domestic lithium and manufacturing and recycling of batteries to increase revenue growth of the company and for emergency management.
   
• Furthermore, Europe is observing growth in the introduction of EV thus instantaneously increasing demand for industrial lithium-ion batteries. For reference by 2030, UK is projected to develop 1.2 million of EVs a year thus enhancing demand for batteries. This growing EV adoption will aid regional market growth.