The market for lithium ion batteries is experiencing changes across consumer, automotive and industrial segments. One of the contributing factors is the price reduction of lithium ion batteries due to industry over-capacity and competition.
The proliferation of new consumer gadgets and rapid strides taken by the battery industry to keep up will also give a strong boost to the market. Electric vehicles, which have been on the cusp of strong growth for a while now, are expected to help triple the automotive lithium ion batteries market. The industrial batteries segment too will grow on the back of stationary energy storage applications.
New analysis from Frost & Sullivan finds that the market earned about $2.21 billion in 2012 and estimates this to more than double to $4.82 billion by 2017 due to the widening market and product scope.
New energy storage applications in electric vehicles, grid-connected stationary energy storage, and the higher energy requirements of new consumer gadgets are expected to alter market dynamics. The lithium ion batteries market has to make the most of these changes and find usage in these application areas.
Lithium ion batteries are the preferred energy sources for consumer gadgets such as phones, tablets, mp3 players, next-generation electrically propelled light motor vehicles, and many industrial and commercial applications. In emerging consumer applications such as smartphones and tablets, lithium ion batteries are likely to generate high volumes but require technology upgrades to grow faster.
Consumer gadgets like smart phones and ultrabooks are energy intensive; however battery technology has not kept pace with their growth. This has led to R&D for newer chemistries in industrial and automotive segments that might prove disruptive to the lithium ion batteries market.
With expectations of strong market growth, the competitive intensity and the production capacity in the industry has dramatically increased. So, apart from infusing funds into R&D to improve battery performance, manufacturers are resorting to price cuts to stay competitive. They are also trying to increase product compatibility and decrease product prices to suit a wider gamut of applications.