The lithium-ion (Li-ion) battery market is racing ahead with the launch of eagerly awaited brands of electric vehicles (EVs) and hybrid EVs (HEVs). These types of vehicles are produced in much larger numbers than previous generations of EVs and HEVs, giving a boost to the installation of Li-ion batteries.
Further, HEVs that previously used nickel-metal hydride (NiMH) technology are now shifting to Li-ion.
New analysis from Frost & Sullivan‘s Global Hybrid Electric and Electric Vehicle Lithium-ion Battery Market research finds the market earned revenues of $2.13 billion in 2012 and estimates this to reach $12.84 billion in 2019.
The persistent volatility of crude oil prices turns the spotlight on more economical alternatives such as EVs to meet transportation needs, without compromising reliability and convenience. Owing to their environment-friendliness, the Li-ion battery market has government support in the form of rebates, which varies according to the country, state and city.
Rebates are further determined by the actual vehicle type including (hybrid, fully electric); extended range EVs (EREVs); and battery EVs (BEVs), all of which qualify for higher rebates than HEVs.
While rebates and other promotional schemes do persuade consumers to invest in EVs, the biggest purchase factor is the initial investment cost for the vehicle. The high costs of the battery makes EVs less price competitive than the more traditional internal combustion engine (ICE) vehicles.
Manufacturers are attempting to tackle this cost challenge by increasing production volumes, improving efficiencies in production processes, and finding other suitable applications for these batteries to improve economies of scale.
Manufacturers are striving to establish standards as each battery company is hoping to identify the ideal battery chemistry and configuration. The lack of standards complicates the logistics and practicality of both battery swapping and second-life applications. Consumers also expect Li-ion batteries to provide superior vehicle performance, reliability, durability and range.