Traction Battery Market
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The global traction battery market size was anticipated at USD 65.6 billion in 2024 and is expected to witness a CAGR of 22.6% from 2025 to 2034. Traction batteries are arising as important components in renewable energy systems, especially in vehicle-to-grid (V2G) integration. With this, EVs are able to act as mobile sources of electricity, enriching the reliability of the grid as well as its consumption of renewable energy. The growth of interest in renewable energy is shifting traction batteries to the dual-use paradigm which enables them to work on vehicles and be used as energy sources for multiple systems. This definitely works for regions with high investment into renewable energy infrastructure such as traction batteries because it assists in energy management and makes their initiatives more feasible.
The traction battery industry is being driven by technological disruption including innovations of materials and battery chemistries that improve performance. Lithium-ion batteries are the most popular because of their energy density and longevity, however, solid-state batteries offer greater promise with increased safety and quicker charging. There are also new cost efficient and environmental friendly technologies which utilize cobalt free cathodes and silicon anodes.
| Report Attribute | Details |
|---|---|
| Base Year: | 2024 |
| Traction Battery Market size in 2024: | USD 65.6 Billion |
| Forecast Period: | 2025 to 2034 |
| Forecast Period 2023 - 2032 CAGR: | 22.6 |
| 2023 Value Projection: | USD 485.7 Billion |
| Historical Data for: | 2021 to 2024 |
| No of Pages: | 80 |
| Tables, Charts & Figures: | 20 |
| Segments Covered: | Chemistry, Application |
| Growth Drivers: |
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| Pitfalls Challenges: |
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The market for traction batteries is growing at a fast rate attributed to the adoption of electric vehicles (EVs) globally. Stricter emissions regulations and government incentives favouring EVs has increased the market growth. Sustainability is becoming a global focus, and together with the increasing availability of lithium-ion batteries and charging infrastructure for EVs in almost all regions, the market is highly optimistic. Manufacturers are now focused on increasing the driving range and energy density of these batteries powering electric buses, cars, and even trucks, and the results are promising.
By chemistry, the lithium-ion segment is projected to cross USD 356.2 billion by 2034, due to the increase of EVs and further advancements in battery technology. There is a significant preference of lithium-ion batteries owed to its high energy density, longer life, and faster charging periods, which are highly advantageous in EV applications. Increasing global interest in eco-friendly transportation has prompted manufacturers to aim at improving battery performance while reduce costs at the same time.
The traction battery market from electric vehicle segment is set to grow at a CAGR of over 21.8% till 2034. The major factor stimulating the traction battery industry is increase in the purchase of sustainable means of transport. The global EV market is gaining momentum due to the government measures as well as increased focus on subsidies and emission caps. The improvements in lithium-ion battery technology have further increased the energy density, charging efficiency, and extended driving ranges, thus increasing the interest in electric cars.
The U.S. traction battery market size is estimated to surpass USD 65.7 billion by 2034. The electric vehicle (EV) boom is one of the main drivers behind the expansion of the U.S. traction battery industry. There is also an increase in demand for EVs and sustainable transportation solutions aligned with rise in sales of EVs which results in a higher demand for emission reducing legislation which creates a need for increased sales of premium traction batteries. Expanding markets are also facilitated through improvements in lithium-ion technology which increase energy density, enable fast-charging, and other features.
The Asia Pacific traction battery market is significantly changing on the account of upsurging adoption of electric vehicles (EVs) in China, Japan, and South Korea. China as the world’s largest EV market has a tremendous impact on the region's trends owing to government incentives, subsidies, and investment in EVs infrastructure.
Technological and volume producers such as LG Energy, Samsung, and Panasonic do monopolize the traction batteries market due to their undisputed technology, production scale, and investment in R&D. These leaders of industry are constantly improving the performance and safety of their lithium-ion batteries, increasing their energy density, and reducing the time needed to charge them.
Some of the key players operating across the traction battery industry are:
Market, By Chemistry
Market, By Application
The above information has been provided for the following regions and countries:
Key players in the traction battery market include Aliant Battery, Amara Raja Batteries, BYD, Camel Group, Ecovolta, EnerSys, Exide Industries, Farasis Energy, Guoxuan High-tech Power Energy, Hitachi Energy, Hoppecke Batteries, LG Energy, Midac, Mutlu, Panasonic, Samsung, Sunwoda Electronic, and Toshiba.
The global market for traction battery was reached USD 65.6 billion in 2024 and is expected to witness a CAGR of 22.6% from 2025 to 2034, driven by the acceleration in EV adoption
The lithium-ion segment is set to reach USD 356.2 billion through 2034, propelled by the increasing adoption of electric vehicles (EVs) and advancements in battery technologies.
The U.S. traction battery market is projected to exceed USD 65.7 billion by 2034, led by the increasing adoption of electric vehicles (EVs) and a strong push for sustainable transportation.
The electric vehicles segment is expected to expand at a CAGR of more than 21.8% through 2034, fueled by rising consumer demand for sustainable transportation and government incentives.