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Global Lithium-Ion Battery Market Forecast

As per recent insights from IDTechEx, the global market for lithium-ion batteries is set to experience significant growth over the next decade. Projected market size is anticipated to exceed $325 billion by 2036 with a notable compound annual growth rate (CAGR) of 7%.

According to the forecast, annual production capacity of lithium-ion batteries is expected to surge from approximately 500 GWh in 2020 to nearly 5,000 GWh by 2036. A substantial portion of this increase, more than 50%, will be concentrated in China, which as of 2024 controlled over 75% of total global production capacity. This dominance is largely attributed to rapid advancements in gigafactory developments supported by government incentives.

Key Players in the Industry

The landscape of lithium-ion cell suppliers is heavily dominated by several major players. Companies like CATL, BYD, and Gotion are leading the charge in China, while LG Chem and Samsung SDI hold strong positions in South Korea. Additionally, Panasonic serves as a considerable player in Japan, often directing focus towards the North American and European markets. Notably, the top six manufacturers account for over 65% of global sales, with CATL alone responsible for 37% of sales in 2024, highlighting a tightly-knit industry.

Challenges Facing Gigafactory Expansion

Despite promising production forecasts, the growth of gigafactories appears to be hitting some bumps. Establishing a gigafactory is a multi-year endeavor requiring substantial investments, often ranging between $50 million to $100 million per GWh of capacity. Additionally, the pace of gigafactory development outside of China has been slower, especially in regions seeing less growth in electric vehicles and energy storage systems. Delays and cancellations have notably increased due to geopolitical tensions, particularly those involving the US and China.

For example, LG’s planned facility in Lansing, originally intended as a collaboration with GM Motors set to start production by 2025, faced uncertainties when the joint venture did not materialize as expected. Similarly, Gotion's initiative to expand production from its Michigan gigafactory has been hampered due to concerns regarding its Chinese ownership, which spurred local opposition.

Moreover, Northvolt, another critical player in the market, has seen its expansion plans stalled amid financial difficulties, contributing further to delays in the rollout of battery production across both the American and European sectors. A recent initiative by Lyten to acquire Northvolt’s facilities signals ongoing shifts within the industry, presenting yet another layer of complexity to the battery production landscape.

Future Outlook

Despite these challenges, the outlook for global lithium-ion battery production remains optimistic. The industry is still projected to nearly double its production capacity over the next ten years, with a shifting emphasis towards gigafactory operations in the US and Europe. Insights regarding market trends, player movements, demand assessments, and capacity forecasts are thoroughly studied in IDTechEx's publication on the lithium-ion battery market from 2026 to 2036, providing valuable knowledge for those invested in the evolving landscape of energy solutions.

For further insights and detailed projections on emerging technologies within the lithium-ion domain, IDTechEx continues to provide independent research and analyses that inform stakeholders of market requirements and future opportunities. For more information, visit IDTechEx's official site.