Electric Vehicle Battery Industry Analysis in Europe
Study on Electric Vehicle Batteries in Europe by Lithium-Ion, Lead Acid, and Nickel Hydride Batteries for Passenger and Commercial Vehicles from 2024 to 2034
Analysis of Electric Vehicle Battery Industry Covering Countries Includes Analysis of Germany, Italy, France, Spain, United Kingdom, Nordic, Russia, BENELUX, and Rest of Europe
Electric Vehicle Battery Sales Outlook for Europe (2024 to 2034)
Sales of electric vehicle batteries in Europe are approximated to reach US$ 6.47 billion in 2024 and further increase at a CAGR of 5.9% to climb to US$ 11.48 billion by the end of 2034, as revealed in this updated market study by Fact.MR.
Increasing sales of electric vehicles (EVs) owing to escalating environmental awareness is set to boost electric vehicle battery demand in Europe. The market in Europe is witnessing high investments on the back of benefits and subsidies offered by governments on electric vehicles. Also, the incorporation of product innovation in electric vehicle batteries is further augmenting the market growth in Europe.
Several factors playing a significant role in influencing the sales of EV batteries in Europe are rising fuel prices, increase in demand for zero-emission vehicles on the back of rising environmental awareness and protection needs, and stringent pollution norms, along with depleting fossil fuel reserves. The development of batteries with high efficiency for electric cars is expected to offer growth opportunities for European electric vehicle battery producers.
- According to the European Battery Alliance (EBA), Europe is on the path to becoming the world’s biggest lithium-ion battery cell maker by the end of 2025.
Lithium-ion battery packs offer high energy to vehicles as compared to other electrical energy systems such as lead-acid batteries and nickel hydride batteries. These lithium-ion batteries also offer low self-discharge and provide good high-temperature performance and high-energy efficiency. In light of the ongoing advancements, most of the components of lithium-ion batteries can be recycled, propelling the overall market growth.
Companies in Europe are on a mission to create a battery value chain that is competitive, innovative, resilient, and sustainable at the same time. Along with this, the region is a hotspot for investments by major Asian players.
- Short Term (2024 Q2 to 2027): Short-term demand is likely to surge on the back of an increase in demand for electric vehicles.
- Medium Term (2027 to 2030): Infusing innovation in product offerings, such as launching sand batteries, high-energy-density batteries, and Wi-Fi-powered batteries, will fuel market growth in the medium term.
- Long Term (2030 to 2034): Manufacturers incorporating new technologies in the batteries of electric vehicles will drive long-term market demand.
| Report Attributes | Details |
|---|---|
| Electric Vehicle Battery Sales in Europe (2024E) | US$ 6.47 Billion |
| Forecasted Sales (2034F) | US$ 11.48 Billion |
| Demand Growth (2024 to 2034) | 5.9% CAGR |
| Pouch Pack Sales (2024E) | US$ 2.27 Billion |
| Plug-In Hybrid Electric Vehicles (PHEV) Segment Growth (2024 to 2034) | 6.4% CAGR |
| Key Companies Profiled |
|
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What’s Driving Demand Electric Vehicle Batteries in Europe?
“High Sales of Electric Vehicles Due to Tax Benefits”
Key factor driving market growth is the rising number of investments by private equity firms in the European region. Firms are seeking investment opportunities in the market by following the buy-and-build concept. Investors are targeting Germany and the United Kingdom to buy major battery manufacturing start-ups and companies owing to the high growth prospects of OEMs in these countries.
In addition, respective governments in the region are also offering attractive incentives to consumers for purchasing electric vehicles. This is boosting the sales of electric vehicles, majorly in Switzerland and Norway. Consumers prefer electric vehicles over IC engine vehicles as they are being exempted from vehicle fees such as VAT and purchase taxes.
Which Market Dynamics Can Affect the Profits of Electric Vehicle Battery Suppliers?
“Volatile Raw Material Prices Increasing Production Cost of Electric Vehicle Batteries”
Fluctuations in costs of raw materials of batteries, such as nickel, lithium, and lead, are poised to impact the prices of electric vehicle batteries. Therefore, volatility in lead prices is anticipated to adversely impact the revenue of battery manufacturers as it leads to a reduction in margins. Fluctuations in the prices of lead and lithium are also expected to rise in the coming decade due to an imbalance of the demand-supply equation and rising demand for metals. Thus, price hikes are set to hamper market growth in Europe.
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Start-Up Ecosystem
- IONETIC a United Kingdom-based start-up designs, tests, and makes custom high-performance battery packs for EVs. The company’s EV battery pack solutions adhere to international regulatory standards.
- Automotive Cells Company (ACC) a France-based start-up develops high-performance fast-charging lithium-ion batteries. The batteries offered by ACC offers features such as long-life, high safety, and low charging time. These eco-friendly batteries align with sustainable manufacturing practices.
Country-wise Analysis
How are Electric Vehicle Battery Manufacturers Faring in the United Kingdom?
“Developments in Lithium-ion Battery Production to Drive Profits of Key Market Players”
| Attribute | United Kingdom |
|---|---|
| Market Value (2024E) | US$ 971 Million |
| Growth Rate (2024 to 2034) | 5.8% CAGR |
| Projected Value (2034F) | US$ 1.71 Billion |
Sales of electric vehicle batteries are increasing at a healthy pace in the United Kingdom. The market growth can be attributed to several factors such as the European Commission’s launch of a lithium-ion battery investment project.
- The EC launched a public-private partnership with the Batteries European Partnership Association (BEPA), which is aimed at encouraging research into smart battery technology in Europe over the coming years, which is expected to benefit the market growth in the United Kingdom too. The proposal by the European Commission is designed to modernize batteries to secure sustainability and competitiveness of the value chain in the battery market.
Will Germany Be a Profitable Market for Electric Vehicle Battery Producers?
“Sustainability Trend Boosting Demand for Innovative EV Batteries”
| Attribute | Germany |
|---|---|
| Market Value (2024E) | US$ 1.54 Billion |
| Growth Rate (2024 to 2034) | 4.5% CAGR |
| Projected Value (2034F) | US$ 2.39 Billion |
Germany is one of the most profitable markets for automotive component manufacturers. Germany is forefront in innovations, and automotive sector is no exception. The sustainability trend and strict environmental rules are expected to boost the use of electric vehicles in Germany, subsequently giving rise to adoption of advanced electric batteries.
Batteries play a crucial role in the EU's transition to a climate-neutral economy, as they play an important role in the roll-out of zero-emission mobility and storage of renewable energy. Furthermore, mandatory requirements such as the focus on sustainability (such as minimum recycled content, carbon footprint rules, performance and durability criteria), safety and labeling for marketing, requirements for end-of-life management are set to increase the adoption of electric battery-equipped vehicles.
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Category-wise Analysis
Why are Battery-Electric Vehicles Exhibiting High Demand in Europe?
“Low Carbon Footprint and Greenhouse Gas Emissions of Battery-Electric Vehicles”
| Attribute | Battery-Electric Vehicles |
|---|---|
| Segment Value (2024E) | US$ 2.60 Billion |
| Growth Rate (2024 to 2034) | 6.1% CAGR |
| Projected Value (2034F) | US$ 4.69 Billion |
Battery-electric vehicles also called as pure electric vehicles utilize chemical energy that is stored in rechargeable battery packs. These full electric vehicles have no other source of propulsion such as an internal combustion engine or a hydrogen fuel cell. Battery-electric vehicles (BEVs) run on electric motors and motor controllers.
BEVS are highly gaining traction in Europe compared last decade. These vehicles include bicycles, scooters, motorcycles, forklifts, buses, trucks, and cars. Battery-electric vehicles ability to mitigate greenhouse gas (GHG) emission is increasing their sales growth in Europe. Also, battery-electric vehicles offer lower maintenance due to an efficient electric motor and provide better performance.
Why are Prismatic Cells Widely Used in EV Battery Production?
“Space Efficiency and Improved thermal Performance of Lithium-ion Prismatic Cells”
| Attribute | Prismatic |
|---|---|
| Segment Value (2024E) | US$ 2.46 Billion |
| Growth Rate (2024 to 2034) | 5.8% CAGR |
| Projected Value (2034F) | US$ 4.32 Billion |
Lithium-ion batteries are gaining traction across various applications from portable electronics to electric vehicles. The lithium-ion batteries are composed of various cell designs. Prismatic cell is basically a type of lithium polymer battery cell that is distinguished by its rectangular or square shape.
These cells are widely utilized in EV battery production due to its space efficiency and better packaging characteristics. Lithium-ion prismatic cells are also gaining traction due to their enhanced thermal performance. Its flat design helps in heat dissipation.
Competitive Landscape
Key electric vehicle battery manufacturers are investing heavily in R&D activities to develop new technologies and make batteries that are easier to operate in vehicles. European market players are also undertaking efforts to offer new battery technologies by launching cobalt-free batteries and Wi-Fi-powered batteries, to differentiate themselves from other competitors in the market.
Recent Developments :
- Volkswagen Group is expanding its electric vehicle business by investing in start-ups. It signed a strategic partnership with 24M Technologies in 2022 to improve battery manufacturing.
- In 2023, Nissan announced that it is investing an additional US$ 1.4 billion to develop three new electric models at its plant in Sunderland in northeast England. This is subsequently increasing the adoption of EV batteries.
Fact.MR provides detailed information about the price points of key manufacturers of electric vehicle batteries positioned across Europe, sales growth, production capacity, and speculative technological expansion, in the recently updated report.
Segmentation of Electric Vehicle Batteries Study in Europe
-
By Battery Type :
- Lithium-Ion Batteries
- Lead Acid Batteries
- Nickel Hydride Batteries
-
By Battery Capacity :
- Less than 25 kWh
- 25 to 50 kWh
- 50 to 100 kWh
- More than 100 kWh
-
By Pack Type :
- Prismatic
- Cylindrical
- Pouch
-
By Powertrain Technology :
- Hybrid Electric Vehicles (HEVs)
- Plug-in Hybrid Electric Vehicles (PHEVs)
- Battery Electric Vehicles (BEVs)
-
By Vehicle Category :
- Passenger Vehicles
- Commercial Vehicles
-
By Sales Channel :
- OEMs
- Aftermarket
-
By Country :
- Germany
- Italy
- France
- Spain
- United Kingdom
- Nordic
- Russia
- BENELUX
- Rest of Europe
- FAQs -
How big is the European market for electric vehicle batteries in 2024?
Sales of electric vehicle batteries in Europe are evaluated at US$ 6.47 billion in 2024.
What is future of electric vehicle batteries in Europe?
Demand for electric vehicle batteries is foreseen to increase at a CAGR of 5.9% during the next 10 years.
How much are the projected sales of electric vehicle batteries in Europe?
The European market is forecasted to reach US$ 11.48 billion by 2034.
Which European country is most lucrative for electric vehicle battery producers?
Germany is estimated to hold 23.8% of the European market share in 2024.
What is the market share of battery-electric vehicles?
Battery-electric vehicles are projected to account for 40.9% of the European market share by 2034.
Who are the leading EV battery manufacturers in Europe?
Some of the leading European companies are BMZ Germany GmbH, Volkswagen, and LG Chem Europe GmbH.
Electric Vehicle Battery Industry Analysis in Europe