Traction Battery Market - By Lithium-Ion Chemistry, By Application (Electric Vehicles, Industrial Forklifts, Railroad, Electric Scooters, Electric Motorcycles), Regional Outlook, Growth Potential, Competitive Market Share & Forecast, 2024 - 2032

Traction Battery Market Size

Traction Battery Market size exceeded USD 56 billion in 2023 and is projected to expand at more than 21.3% CAGR from 2024 to 2032. Driven by supportive regulatory policies and tax incentives on electric vehicles.
 

Several global economies are introducing tax credits and incentives to strengthen their EV infrastructure, which is creating stronger revenue streams for the market. An instance of such a favorable scenario can be seen in the US, where the Inflation Reduction Act of 2022 has amended the qualified-plug-in electric drive motor vehicle credit on clean vehicles, promoting the adoption of electric vehicles.
 

As other governments turn their focus towards carbon emission reduction efforts, the demand for electric vehicles is likely to increase in those regional markets as well, positively impacting the industry outlook.
 

Insufficiency of appropriate charging infrastructure may constrain industry scenario

Despite many favorable initiatives, the limited availability charging stations and the time involved in setting up comprehensive charging infrastructures may hinder industry growth. In 2021, the total number of electric vehicles on roads outpaced the number of public charging stations. In fact, in the US, there were over 18 EVs per one charging point in the same year. While many governments are making large investments towards bringing an appropriate charging framework into the picture, the market is likely to remain restricted in its growth until the last planned station is installed.
 

Traction Battery Market Analysis

 

In terms of application, the traction battery market size from electric vehicles segment held a valuation of over USD 36.5 billion in 2022, on account of the consistent government support electric vehicles are receiving for their adoption. Apart from creating a favorable regulatory scenario, mang governments are also making strong investments in the field through R&D and fleet upgradation initiatives. Back in December 2022, the US Postal Service unveiled a historic investment of over USD 9.6 billion for the electrification of its delivery fleet over the coming five years. The market for industrial traction battery is likely to cross USD 53 billion by 2032.
 

Based on chemistry, the traction battery market from nickel-based battery segment is expected to register approximately 24.5% growth rate through 2032, driven by their higher energy and power density in comparison to conventional lead-acid batteries. They also offer a greater storage capacity at a much lower cost than their counterparts. Consequently, high-power, lightweight NiMH batteries have found immense traction in hybrid electric vehicles industry. They also offer good resistance to electrical use and perform well in ambient temperatures, making them that much more ideal for the job. 
 

Asia Pacific traction battery market revenue is anticipated to reach nearly USD 150 billion by 2032, fueled by the sifting emphasis of automobile manufacturers towards EVs leadership in the region. Back in January 2022, Toshiba Infrastructure Systems & Solutions Corporation, a leading Japanese traction battery supplier launched a 20Ah-HP SCiB™ Rechargeable Lithium-ion Battery Cell for hybrid electric vehicles and other applications. The regional growth can also be credited to tax credits on EVs coupled with government support. Moreover, Indias EV industry is the third largest in terms of number of companies, which may increase the demand for traction batteries. 
 

Traction Battery Market Share

Leading traction battery market players include

• Toshiba Infrastructure Systems & Solutions Corporation
• LG Energy Solution
• MIDAC S.p.A.
• Camel Group Co.
• SAMSUNG SDI CO., LTD.
• Mutlu Corporation
• EXIDE INDUSTRIES LTD.

Many of these firms are prioritizing product innovations to capture high market share. Citing an instance, in May 2022, Hitachi Energy, a prominent traction battery manufacturer, launched RoadPak, the companys pioneering power semiconductor module for EVs globally.
 

It features state-of-the-art silicon carbide technology to achieve exceptional levels of power density for rapid charging, minimum power losses, and reliability over the vehicles lifetime for longest driving range.
 

Impact of COVID-19 pandemic

The COVID-19 pandemic affected the global traction battery market severely due to factory closures, plummeting product demand, and supply chain disruptions. The prolonged lockdowns affected electric car sales, which encountered a drop of over 15% in the first half of 2020 as compared to the same period in 2019. However, consistent government funding for electrifying the automobile industry is likely to present a plethora of growth opportunities to industry in the post-COVID-19 era. Furthermore, in October 2022, the U.S. government invested over USD 2.8 billion to accelerate U.S. EV battery manufacturing capability. 
 

The traction battery market research report includes in-depth coverage of the industry with estimates & forecast in terms of “USD Million” from 2019 to 2032, for the following segments:

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Market Insights, By Chemistry

• Lead Acid
• Lithium-Ion
• Nickel-Based
• Others

Market Insights, By Application

• Electric Vehicles
• BEV
• PHEV

• Industrial
• Forklifts
  • Class 1
  • Class 2
  • Class 3
• Railroad
• Others
• E-Bikes
• E-Scooters
• E-Motorcycles

The above information has been provided for the following regions and countries:

• North America
  • U.S.
  • Canada
  • Mexico 
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Netherlands
  • Norway
  • Austria
  • Belgium
• Asia Pacific
  • China
  • Australia
  • India
  • Japan
  • South Korea
  • Philippines
  • Thailand
  • Vietnam
• Middle East & Africa
  • UAE
  • Saudi Arabia
  • South Africa
• Latin America
  • Brazil
  • Argentina