Electric Vehicle Battery Formation and Testing Market Size

The global electric vehicle battery formation and testing market size was valued at USD 1.9 billion in 2023 and is projected to grow at a CAGR of over 17.6% between 2024 and 2032. Innovations in battery technologies, such as solid-state and advanced lithium-ion batteries, are advancing the market. These batteries offer higher energy density, safety, and performance but require specialized testing and formation systems to ensure reliability and durability. The demand for accurate and comprehensive testing methods has led to investments in cutting-edge equipment and processes. Companies are increasingly adopting AI, machine learning, and automation to streamline testing, boosting demand for advanced solutions.

For instance, in August 2024, IPTE announced a multi-million-dollar contract with Volkswagen. This project enhances IPTE's position in the automotive sector by developing an advanced test solution for electric vehicle (EV) battery packs. As EVs gain global traction, this initiative addresses the rising demand for reliable and efficient testing methodologies.

Battery safety is crucial in the EV market, highlighted by numerous high-profile battery failures and fires. This has increased the need for comprehensive testing to meet stringent safety standards. Testing during the formation phase helps detect early defects that could lead to operational failures. As electric vehicle batteries store large amounts of energy, faulty batteries pose significant risks, necessitating advanced testing for thermal management, overcharging, and shock resistance. Manufacturers prioritize safety to avoid recalls and ensure consumer confidence, driving demand for testing solutions.

Electric Vehicle Battery Formation and Testing Market Trends

As EV consumers demand quicker charging times and longer driving ranges, manufacturers are developing high-power, fast-charging batteries. These advanced batteries require specialized formation and testing protocols to ensure they handle increased energy throughput safely and durably. The push for fast-charging capabilities intensifies demands on testing systems, driving the need for equipment that can simulate high-energy cycles and rapid charge-discharge conditions.

Specialized testing and formation equipment are crucial for ensuring battery performance and safety. These systems replicate extreme conditions, such as high energy input, to evaluate the battery's fast-charging capabilities. Rigorous testing enables manufacturers to ensure that high-power batteries can endure real-world usage without compromising longevity, safety, or efficiency.

For instance, in July 2023, TUV SUD launched a state-of-the-art environmental laboratory in Auburn Hills, Michigan. This facility highlights the company's commitment to enhancing quality and performance standards in electric vehicle battery and system solutions. The laboratory will support the growing EV market and the trend of increasing battery sizes.

The increasing diversity in battery chemistries, from lithium-ion to emerging solid-state batteries, complicates the testing process. Each chemistry has distinct requirements for formation, testing, and safety protocols. For instance, solid-state batteries, despite their promise, necessitate new testing methodologies due to their unique properties. This complexity forces manufacturers to continuously upgrade their testing equipment and methodologies, escalating costs and operational challenges. Additionally, testing equipment must be highly adaptable to accommodate new chemistries, increasing engineering and R&D difficulties. Failure to adapt could result in inaccurate test results, compromising battery safety and performance, which is critical for end-user trust and regulatory compliance.

Electric Vehicle Battery Formation and Testing Market Analysis

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Based on components, the market is segmented into formation systems, testing systems, and software solutions. In 2023, the formation systems segment accounted for a market share of over 47% and is expected to exceed USD 3.4 billion by 2032. Heat generation during battery formation, particularly in Li-ion batteries, poses safety risks. Modern formation systems now feature advanced thermal management technologies to maintain safe operating temperatures during initial charge-discharge cycles.

For instance, in October 2023, at the Industrial Transformation Asia-Pacific (ITAP) 2023 event, the Agency for Science, Technology, and Research (A*STAR) introduced a new Electric Vehicle (EV) Battery Testing and Disassembly Line. This initiative supports A*STAR's broader strategy, involving its research institutes — the Advanced Remanufacturing and Technology Centre (ARTC), Singapore Institute of Manufacturing Technology (SIMTech), Institute of Materials Research and Engineering (IMRE), National Metrology Centre (NMC), and Institute of High-Performance Computing (IHPC).

These institutes collaborate with partners to advance a circular economy for batteries by developing critical remanufacturing processes and system solutions. These systems employ liquid or air-based cooling mechanisms to prevent thermal runaway events. Enhanced safety protocols for formation systems are crucial, as overheating can cause battery cell degradation or catastrophic failure. This focus on safety addresses growing regulatory scrutiny and the need for reliable, high-quality battery packs for electric vehicles.

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Based on battery, the electric vehicle battery formation and testing market is divided into Li-ion batteries, solid-state batteries, lead-acid batteries, and nickel-metal hydride batteries. The Li-ion batteries segment held around 74% market share in 2023. Enhancements in energy density are enabling lithium-ion batteries to extend electric vehicle (EV) driving ranges.

Advances in high-nickel cathodes and silicon anodes contribute to this trend by reducing battery pack weight and volume, thus improving vehicle efficiency and performance. These developments address consumer concerns about range and charging frequency. Automakers and battery manufacturers are heavily investing in R&D to create lighter, longer-lasting batteries, enhancing EV competitiveness against internal combustion engine vehicles.

Li-ion battery technology is also advancing to reduce charging times, a significant barrier to EV adoption. Innovations such as high-rate charging cells and optimized battery management systems (BMS) facilitate faster energy transfer while maintaining safety and battery life. Improvements in cooling technologies and charging infrastructure support this trend. Automakers and battery developers aim to achieve "fast-charging" solutions that recharge batteries to 80% capacity within 15-20 minutes, increasing the practicality of EV ownership.

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Asia Pacific region accounted for a market share of over 46% in 2023 and is expected to exceed USD 4 billion by 2032. The Asia Pacific region leads the EV battery formation and testing market, driven by China's dominance as the largest EV market and battery manufacturer. Significant growth is supported by investments in battery gigafactories and government incentives.

Japan and South Korea focus on technological innovation and battery efficiency. Key trends include solid-state batteries and localized production. The shift towards electric two-wheelers and commercial EVs increases demand for testing solutions. India is emerging as a growth hotspot, with government support for electric mobility and local battery manufacturing.

In North America, the electric vehicle (EV) battery formation and testing market is propelled by rising EV adoption, particularly in the United States. The Biden administration's policies and investments in battery production and clean energy boost demand for battery formation and testing systems. Major automakers, including Tesla, invest heavily in gigafactories. The focus on advanced battery technologies, such as solid-state and recyclable batteries, necessitates specialized testing solutions. The growing popularity of electric trucks and commercial EVs further drives demand for advanced testing technologies.

Europe's electric vehicle battery formation and testing market is expanding rapidly due to stringent emission regulations and the EU's push for zero-emission vehicles. Germany, France, and Norway invest heavily in EV infrastructure and battery production. The region leads in solid-state batteries and recycling technologies, increasing demand for advanced testing equipment. The European Green Deal and CO2 reduction targets accelerate innovation among automakers and battery manufacturers. Europe's emphasis on sustainable battery production drives demand for eco-friendly and energy-efficient testing processes.

Electric Vehicle Battery Formation and Testing Market Share

Keysight Technologies, Chroma ATE, Inc., and Arbin Instruments held a significant market share of over 10% in 2023. Keysight leverages its expertise in electronic measurement to develop advanced battery formation and testing solutions. It focuses on precise testing of battery management systems (BMS), cell aging, and thermal management to meet evolving EV battery requirements. Keysight collaborates with automotive manufacturers and battery developers to tailor solutions that meet specific performance and safety standards, ensuring alignment with industry needs.

Chroma ATE offers a comprehensive range of battery formation, grading, and safety testing systems, positioning itself as a one-stop solution for EV battery testing. Chroma invests in research and development to enhance the efficiency and accuracy of its testing systems, particularly for high-density Li-ion and solid-state batteries. Chroma provides customizable testing systems based on the battery types used in electric vehicles, addressing the specific requirements of different automakers and battery manufacturers.

Arbin delivers high-precision battery testing and formation systems, scalable from R&D labs to large-scale manufacturing. Their systems efficiently handle high-volume testing for large EV battery packs. Arbin integrates advanced data management and analytics software, enabling real-time monitoring, diagnostics, and predictive analysis for EV batteries.

Electric Vehicle Battery Formation and Testing Market Companies

Major players operating in the electric vehicle battery formation and testing industry are:

• Ador Digatron Pvt. Ltd.
• Arbin Instruments
• AVL
• Bitrode Corporation
• Chroma ATE Inc.
• Keysight Technologies
• Maccor Inc.
  

Electric Vehicle Battery Formation and Testing Industry News

• In July 2024, EA Elektro-Automatik (EA), a leader in DC programmable and bidirectional power supplies, launched an enhanced EA BTS 10300 Battery Test System. This system offers 300 kW power density in a single 42U-high rack, occupying only 6.5 square feet of production floor space. The compact, automated battery cycler and test system addresses manufacturers' challenges in efficient EV battery testing.
  
• In February 2024, Hioki E.E. Corporation introduced the LR8102 and LR8101 voltage and temperature data loggers. These models, designed for seamless integration into EV battery testing systems, support the development of safe and efficient testing processes. Both loggers feature insulation performance up to DC 1,500 V and high-speed communication protocols for millisecond data transfer.
  

The electric vehicle battery formation and testing market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue (USD Billion) and shipment (Units) from 2021 to 2032, for the following segments:

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Market, By Component

• Formation system
  • Formation chargers
  • Control system
• Testing system
  • Battery cyclers
  • Battery testing equipment
  • Others
• Software solutions

Market, By Battery

• Li-ion
• Solid-state
• Lead-acid
• Nickel-metal hydride

Market, By Electric Vehicle

• Battery Electric Vehicles (BEVs)
• Plug-in Hybrid Electric Vehicles (PHEVs)
• Hybrid Electric Vehicles (HEVs)

Market, By End User

• Battery manufacturers
• Automotive OEMs
• Third-party testing service providers
• EV charging infrastructure companies

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Italy
  • Spain
  • Russia
  • Nordics
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • ANZ
  • Southeast Asia
• Latin America
  • Brazil
  • Mexico
  • Argentina
• MEA
  • UAE
  • Saudi Arabia
  • South Africa