Traction Battery Market Size, Share & Industry Analysis By Type (Lead-Acid, Lithium-Ion, Nickel Based, Others), By Capacity (Less than 100 Ah, 100 Ah - 200 Ah, 200 Ah - 300 Ah, 300 Ah - 400 Ah, 400 Ah & above), By Application (Battery Electric Vehicles (BEV), Locomotives, Others ) And Regional Forecast, 2024-2032

A traction battery is a collection of accumulators that store energy to drive the vehicle's traction motor(s). A battery used to power the electric motors of a battery electric vehicle (BEV) or hybrid electric vehicle is an electric-vehicle battery (EVB), also known as a traction battery. Lead Acid batteries have traditionally been used in traction applications, but their limitations, along with the expensive cost of alternatives, have limited the range of viable battery-powered traction applications.

The worldwide traction battery market is expected to increase during the projected period due to the enormous usage of traction batteries in electric and hybrid vehicles. Furthermore, traction batteries are recyclable; they are in high demand in multiple industries, including the automotive and manufacturing industries, leading to the global demand for traction batteries.

The electrification of the transportation industry necessitates the use of traction batteries, which is likely to increase the demand for traction batteries over the forecast period. Government regulations and laws favoring the production and sale of electric vehicles are expected to propel the worldwide traction battery market. The traction battery market is predicted to rise due to rising demand for electric vehicles and increased application in forklifts, among other factors.

Growing demand for hybrid cars also positively influences the growth of the market. It's worth noting that traction batteries are both recyclable and environmentally beneficial, essential in the electrification of transportation systems, and are thus in high demand from the automotive and manufacturing industries. Furthermore, they have a lot of government assistance. It is mainly because efforts are being directed toward reducing gasoline emissions. As more people become aware of the hazardous effects of these pollutants, the market will only continue to rise.

Traction batteries are also excellent for industrial applications due to their long service life, lightweight packs, and growing power storage capacity. Rapid industrialization increased e-commerce penetration, and advancements in material handling technology will contribute to the traction battery market's growth.

• According to International Energy Agency, in 2020, electric car sales surpassed 3 million for the first time, an increase of 40% over 2019. This outstanding performance contrasted sharply with worldwide car market sluggishness, with overall car sales down 16 percent due to the Covid-19 crisis. There are now over 10 million electric cars on the road, accounting for 1% of all vehicles on the road. According to the Net Zero Emissions by 2050 Scenario, 300 million electric automobiles will be on the road by 2030, accounting for more than 60% of new car sales, up from only 4.6 percent in 2020. Early sales data for 2021 predicts that critical markets will experience substantial growth.

The main factors hindering the growth of the global market are the high pricing, battery issues, and patchy charging infrastructure (BEVs). There are also concerns with a variety of power semiconductors and other devices.

As the constant need to electrify the transportation industry and federal laws, purchasing incentives, and goals relating to energy efficiency and carbon emissions, the North American traction battery market is expected to grow significantly. For example, the U.S. government established a USD 7,500 tax credit for BEV and PHEV cars acquired in and after 2010. In addition, as consumer preferences shift toward electric forklifts across the material handling industry, product penetration will increase therefore escalating the demand for the traction battery globally.

• By 2030, the federal government wants E.V.s to account for half of all new passenger vehicles and light trucks sold in the U.S. At the same time, a handful of states have set more ambitious goals for themselves.


• Canada stated in 2021 that all new light-duty cars and passenger trucks will be zero-emissions by 2035, up from its earlier aim of 100 percent sales by 2040.

IMPACT OF COVID-19 ON THE TRACTION BATTERY MARKET

The traction battery market is expected to take a significant amount of time before recovering from the impact of the COVID-19 pandemic. Despite this, the low adoption rate of the product coupled with the pandemic has hampered the market devastatingly. However, the easing restrictions, growing electric vehicles demand, increasing consumer conscience towards green energy are anticipated to help regain the market.

KEY INSIGHTS

The report will cover the following key insights:

• Recent Advancements in Traction Battery


• Key Industry Trends


• Regulatory Landscape for Traction Battery


• Key Industry Developments (Mergers, Acquisitions, and Partnerships)


• Impact of COVID-19 on the Market

ANALYSIS BY TYPE

Based on type, the global market is segmented into lead-acid, lithium-ion, nickel-based, and others. The lead-acid battery segment held a significant share of the global market and is expected to increase. Higher cyclability, lower price, and excellent vibration resistance are just a few essential qualities that will help these batteries gain traction globally. The rapid drop in costs and excellent charging efficiency are credited with the industry's success. Electric vehicles, forklifts, golf carts, floor scrubbers, and e-bikes all use lead-acid batteries as a stable and durable power source.

Furthermore, high energy density and design qualities will outperform lithium-ion batteries in electric car applications. Its increasing popularity in e-bikes outside of China and its excellent power-to-weight ratio, making it a good candidate for battery-electric cars.

When compared to current alternatives, Ni-MH has a higher gravimetric and volumetric energy density, making it more suited for HEVs. Higher power density, design qualities, and the capacity to function at average ambient temperatures are just a few critical factors that will help the device gain traction. Around 70% of hybrid electric vehicles worldwide are fitted with Ni-MH batteries, indicating a promising future for the traction battery business.

ANALYSIS BY APPLICATION

Based on the application, the global market is segmented into battery electric vehicles, locomotives, and others. The battery electric vehicles (BEV) segment is leading the market led by government initiatives to increase awareness about reducing GHG emissions, which will boost the corporate outlook. The government-led tax incentives and aggressive targets established by electric automakers to promote E.V.s across developed countries are responsible for the business's growth. The industrial segment of the market will benefit from rapid industrialization and shifting consumer preferences toward electric forklifts. Increased e-commerce business activities and the unavoidable usage of electric forklifts to improve efficiency and sustainability of business operations contribute to the industry's rapid growth.

REGIONAL ANALYSIS

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In 2020 Europe's traction battery market was worth more than USD 6 billion, and it's expected to keep growing thanks to rising E.V. sales and severe aims to reduce the automotive sector's carbon emissions. The recent announcements in France and the United Kingdom to ban conventional gasoline and diesel cars by 2040 will boost regional growth rates, providing colossal development potential for the industry.

The Asia Pacific market is expected to increase significantly during the anticipated period. The Asia Pacific market outlook will be boosted by favorable policy adoptions and growing concerns about the automotive sector's contribution to emissions levels. The increase in investment across primary battery manufacturing countries such as China, Japan, and South Korea is credited for the region's prosperity. Government-led initiatives to promote e-mobility and suitable charging infrastructure in India will open new opportunities for industry players.

KEY PLAYERS COVERED

The report will include key players such as Hitachi ABB, Samsung, Johnson Controls, Exide, BYD Company, L.G. Chem, Mutlu, Enersys, Panasonic, Hoppecke Batteries, G.S. Yuasa,  Haze Batteries, Midac, etc.

SEGMENTATION

KEY INDUSTRY DEVELOPMENTS

• In June  2021, Hitachi ABB Power Grids and Teollisuuden Voima Oyj (TVO) had secured a deal to deliver one of Europe's largest battery energy storage systems to Finland's Olkiluoto nuclear power plant. The 90MW system will support the whole energy network at the Olkiluoto NPP's unit 3, reducing the grid's impact from power fluctuations. The turnkey system serves as a backup power supply with a quick start time. In 2022, the battery energy storage system will be operational.


• In October  2021, Stellantis (STLA.MI) and Samsung SDI Co Ltd of South Korea have agreed to form a joint venture in the United States to create electric vehicle (E.V.) battery cells and modules.