Second-Life Automotive Lithium-Ion Battery Market To Generate $7,392.0 Million Revenue by 2030

A number of factors such as the surging adoption of electric vehicles (EVs) and soaring cost of the battery recycling process will drive the second-life automotive lithium-ion (Li-ion) battery market at a CAGR of 23.1% during the forecast period (2020–2030). The market was valued at $430.0 million in 2019 and it is expected to generate $7,392.0 million revenue by 2030. In recent years, the market has been witnessing several partnerships and collaborations among various players, which is becoming a prominent trend.

The rising adoption of EVs, on account of the mounting environmental concerns and growing government support for EV manufacturers and customers, is one of the key growth drivers for the market worldwide. According to the International Energy Agency (IEA), 4.79 million battery electric vehicles (BEVs) were sold across the world in 2019. The adoption of these new energy vehicles helps in mitigating greenhouse gas emissions, which will further help in decelerating the ozone layer depletion rate.

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Another growth driver for the second-life automotive Li-ion battery market is the escalating cost of the battery recycling process. Li-ion batteries have only 2–7% of lithium and procuring it through the recycling process is five times more expensive than extracting it directly from natural sources. Cobalt is the only material that is worth recycling. Due to such limitations of the recycling processes, battery manufacturers are largely focusing on the development of batteries that omit or reduce the use of lithium by replacing it with a cheaper and more stable substance.

The application segment of the second-life automotive Li-ion battery market is categorized into energy storage, EV charging, base station, and low-speed EV. In 2019, the base station category held the largest share, due to the increasing use of battery systems in telecommunication base stations as a comprehensive and highly distributed asset for frequency containment disturbances reserve. Whereas, the energy storage category is expected to demonstrate the fastest growth during the forecast period, as second-life automotive Li-ion batteries offer a reserve energy capacity to maintain the power reliability of utilities at minimal cost by displacing less efficient and more expensive assets.

According to P&S Intelligence, Asia-Pacific (APAC) accounted for the largest share in the second-life automotive Li-ion battery market during the historical period (2014–2019), and it is expected to retain its dominance throughout the forecast period. This can be primarily attributed to the fact that China is the world’s largest procurer of EVs, owing to the strong government support for the adoption of these vehicles in the country. For instance, according to the IEA, 2.58 million BEVs and 0.77 million plug-in hybrid electric vehicles (PHEVs) were sold in China in 2019. Whereas, the European second-life automotive Li-ion battery market is projected to exhibit the fastest growth during the forecast period, due to the burgeoning sales of EVs in the region.

According to the IEA, electric car sales in Europe surged from 0.40 million in 2018 to 0.59 million in 2019. Moreover, the implementation of a strategic action plan for batteries in Europe in May 2018, to build an enhanced battery value chain, which includes embracing raw material extraction, manufacturing cells and battery systems, and sourcing and processing of battery materials, will also support the market growth in the upcoming years.

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Thus, the burgeoning demand for EVs and the mounting cost of the battery recycling process will support the market growth in the foreseeable future.

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This release was published on openPR.