Sales of Li-Ion Battery Packs Plummet as COVID-19 Pandemic Hampers Lithium Production
The rapidly burgeoning impact of the COVID-19 pandemic on the global business economy is now showing devastating results. All major industries, including the Li-ion battery pack manufacturing industry, are witnessing a slump. Production of lithium, a key constituent of the Li-ion battery pack, has been hampered exceptionally due to the nation-wide lockdowns imposed by key lithium producing countries such as Australia, Chile, and Argentina.
Consequently, major lithium mining companies have had to either shutter their facilities or operate at less than half of the capacity. For instance, in April 2020, the French mining company Eramet Group stopped work on its lithium production project in Argentina due to economic uncertainty created by the COVID-19 pandemic.
Based on the aforementioned facts, the global li-ion battery pack market is projected to witness slow growth at a CAGR of 2.7%, and is pegged at more than US$ 75.3 Bn by the end of forecast period (2020 – 2030).
COVID-19 Pandemic to Hinder Adoption of LCO Batteries
Lithium Cobalt Oxide (LCO) batteries account for a majority share in the global Li-ion battery pack market. These batteries are mainly used in portable electronics devices such as cellular phones, laptops, digital cameras etc. Lockdowns imposed in most of the countries amid the COVID-19 outbreak has stalled the production of LCO batteries as the leading electronics companies have restricted manufacturing operations.
For instance, in March 2020, Sony Electronics closed its manufacturing facilities in Malaysia and Wales. Earlier, in January, the company had to shut down four of its manufacturing sites in China. This in turn, has dramatically lowered the demand for LCO batteries.
In addition, decelerated consumption of the consumer electronic products & replacement batteries due to retail outlets’ closure has also contributed to the falling demand for LCO batteries globally. Fact.MR opines that the lithium cobalt oxide batteries will expand at a value CAGR of 1.1% and create an absolute $ opportunity of US$ 3.3 Bn during the forecast period.
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Li-ion Battery Pack to Witness Stunted Growth Due to Volatility in End Use Industries
The outbreak of COVID-19 has brought uncertainty to every industry, and end use sectors of Li-ion battery pack are no exceptions. The global automotive sector, which was already witnessing a downturn, is facing decelerating demand.
For instance, in the first quarter of FY2020, Nissan Motors registered decline in electric vehicle sales by around 27%. While the demand for electric vehicles is projected to dip significantly, the demand for medical equipment such as ventilators equipped with li-ion batteries have accelerated significantly.
Manufacturers have ramped up the production of ventilators, which is expected to create significant opportunity for li ion battery pack manufacturers in the upcoming quarters. The automotive & medical devices segments are poised to expand at value CAGRs of 2.6% & 4.1% respectively.
APEJ to Maintain its Hegemony in Global Li Ion Battery Pack Market
Asia Pacific Excluding Japan (APEJ) has dominated the global li-ion battery pack market since 2019, accounting for nearly 35% of the market. Countries in APEJ, for instance, China, play a critical role in the electronics manufacturing industry. It accounts for 27% of the world’s smartphone market. Also China is a battery manufacturing powerhouse in the world, making the APEJ a leader in global li-ion battery pack market.
However, it is now grappling with a slow down due to the coronavirus outbreak. Production in the region was almost dormant for last couple of months due to the lockdown imposed amid the pandemic. However, as the situation in APEJ is being contained, companies are resuming their operations. For instance, in March 2020, Leoch- a leading manufacturer of batteries resumed production of li ion battery pack in China. APEJ is set to expand at a value CAGR of 3% by the end of forecast period, capturing over one-third of the Li Ion Battery Pack Market.
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Partnerships with End-use Industry Leaders to Give Succor to Market Players in Short Term
The global li ion battery pack market is moderately consolidated. Leading manufacturers in the lithium ion battery pack market are establishing partnerships with end-use industry leaders in order to stimulate growth. For instance, in December 2019, LG Chem Ltd., a leading li ion battery pack player, collaborated with General Motors (GM) to produce li ion batteries for its electric vehicles.
COVID-19 Impact Insights:
The unprecedented effects of the novel coronavirus on social as well as commercial aspects of the world are intensifying with the extension of lockdowns in most of the countries. The pandemic has presented critical challenges to the li-ion battery pack industry players such as insufficient raw material supply, shortage of work force, hampered supply chain etc. China, which is the leading li-ion battery pack manufacturing country, is facing reduced exports as most shipping ports in the country are currently not operational.
As a consequence, the sale of consumer electronic devices have been hampered globally, substantially impacting the demand for li-ion battery packs. Therefore, the global li-ion battery pack market is expected to remain stagnant for next couple of financial quarters. However, after the pandemic is brought under control, the market is poised to regain the traction and is set to grow 1.3X through the forecast period.
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“The outbreak of COVID-19 has substantially lowered the production and demand for li-ion battery packs. As a result, the market is poised to register slow growth for next couple of quarters. However, in the second half of the forecast period, it will create significant opportunities.”
Global Li-Ion Battery Pack Market: Scope of the Report:
The recent global li ion battery pack market report by Fact.MR offers a 10-year forecast from 2020 to 2030. The report elaborates on the key drivers, restraints, opportunities and threats to the expansion of the global li ion battery pack market. A detailed segmental analysis, based on product type, cell type, nominal voltage, battery capacity, end use application, and regions, has been provided in the report.
Regional analysis in terms of supply chain analysis, business execution and market value analysis provides an in-depth perspective about the future scope of the global li ion battery pack market. In addition, a separate section on market structure has also been provided. The section provides a detailed analysis of key market players and the strategies for expansion in the li ion battery pack market.
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Key Segments of the Li-ion Battery Pack Market
Fact.MR’s study on the Li-ion battery pack market offers information divided into two key segments-product type, cell type, nominal voltage, battery capacity, end use across six major regions. This report offers comprehensive data and information about important market dynamics and growth parameters associated with these categories.
- Lithium Cobalt Oxide
- Lithium Magnesium Oxide
- Lithium Iron Phosphate
- Lithium Nickle Manganese Cobalt Oxide
- Lithium Nickle Cobalt Aluminium Oxide
- Lithium Titanate
- Less than 12V
- More than 24V
- >20 KWhr
- 30-60 KWHr
- More than 80
- Consumer Electronics
- Digital Camera
- Medical Devices
- Industrial & Grid Energy
- North America
- Latin America
Key Questions Answered in the Fact.MR’s Li Ion Battery Pack Market Report
- Which regions will continue to remain the most profitable regional markets for Li-ion battery pack market players?
- Which factors will induce a change in the demand for Li-ion battery pack during the assessment period?
- How will changing trends impact the Li-ion battery pack market?
- How can market players capture the low-hanging opportunities in the Li-ion battery pack market in developed regions?
- Which companies are leading the Li-ion battery pack market?
- What are the winning strategies of stakeholders in the l Li-ion battery pack market to upscale their position in this landscape?
Li-ion Battery Pack Market: Research Methodology
In Fact.MR’s study, a unique research methodology is utilized to conduct extensive research on the growth of the li ion battery pack market, and reach conclusions on future growth parameters of the market. This research methodology is a combination of primary and secondary research, which helps analysts ensure the accuracy and reliability of conclusions.
Secondary resources referred to analysts during the preparation of the li ion battery pack market study include statistics from governmental organizations, trade journals, white papers, and internal and external proprietary databases.
Analysts have interviewed senior managers, product portfolio managers, CEOs, VPs, marketing/product managers, and market intelligence managers, who have contributed to the development of this report as a primary resource.
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Fact.MR follows a methodology that encompasses the demand-side assessment of the market, and triangulates the same through a supply-side analysis. This methodology is based on the use of standard market structure, methods, and definitions.
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