US$52b EV battery cell and pack materials market forecast

Markets for lithium-ion battery materials such as nickel, cobalt, copper and insulation will see a rapid increase in demand that would not have been there without EVs, IDTechEx says. 

Its report Materials for Electric Vehicle Battery Cells and Packs 2021-2031 identifies and analyses trends in the materials used for the assembly and production of battery cells and battery packs in the EV market and expected to reach US$52 billion by 2031.

The report also provides granular market forecasts for more than 20 key material categories in terms of demand in tonnes in addition to market value.

 OEMs are changing the way they make batteries, the report says.

Improvements to energy density are one key but also the sustainability of the materials used.

Many materials involved have questionable mining practices or volatile supply chains, IDTechEx suggests.

“One such material is cobalt which, in addition to being very expensive, has its supply and mining confined mostly to China and the Democratic Republic of Congo. As a result, OEMs are trending towards higher nickel cathode chemistries like NMC 622 or NMC 811 in some new models.”

 Up until 2018, the Chinese electric car market was predominately using LFP cathodes. As of 2019, only 3% of cars utilised LFP batteries.

However, Tesla has now introduced the LFP Model 3 made in China, which could upset this trend. Additionally, LFP is used extensively for markets like Chinese electric buses. Despite the reduction in market share of materials like cobalt, the rapidly increasing market for EVs will drive demand for cobalt and many other materials drastically higher over the next 10 years, the report says.

Energy density improvements of li-ion cells might be the most prominent battery improvements in the public eye, but we are also seeing an increase in pack-level energy density at a greater rate than just cell-level improvements, IDTechEx says.

“Manufacturers are improving their battery designs; the mass of materials being used around the cells is steadily being reduced, allowing for a lighter battery pack or more cells to be used for the same mass.”

The choice of materials for several pack components also affects these improvements, IDTechEx says.

“More interest is being paid to composite enclosures for light-weighting, fire-retardant materials, thermal interface materials, and much more.

“The thermal management strategy also impacts these choices; with increased energy density and consumer demand for fast charging, thermal management has to be more effective but also present a smaller and lighter package. Several materials see a decrease in utilisation per vehicle, but this is often overshadowed by the rapidly growing market for EVs.”

The report analyses more than 160 BEV and PHEV models for energy density and thermal management.

An extensive database is also collated by IDTechEx of at least 300 BEV and PHEV passenger car variants to determine trends in the battery cell and pack energy density, energy capacity, cell geometry, cell chemistry, and thermal management strategy, leading to a comprehensive set of material demands and market value forecasts.