North America Battery Market Outlook, 2027

North America is one of the largest consumers of batteries, and the integration of renewable energy with energy storage systems is expected to supplement the market in the forecasting period. Other factors driving the market include a decrease in the prices of lithium-ion batteries; a rise in the adoption of electric vehicles; growth in the renewable energy sector; and an increase in the sale of consumer electronics. The automotive sector is expected to be one of the major end-user segments for batteries, primarily lithium-ion batteries, in the coming years. The penetration of electric vehicles is anticipated to provide a massive impetus for the lithium-ion battery industry growth in North America. Different vehicle types are now available, featuring increasing degrees of hybridization and electrification. There are various types of vehicles, including hybrid electric vehicles (HEVs), plug-in hybrid electric vehicles (PHEVs), and electric vehicles (EVs). The adoption of electric vehicles is increasing at a high growth rate. The United States is already among the countries leading in global EV sales, and other economies like Canada have already begun transforming their public transportation infrastructure for EVs. According to the report, "North America Battery Market Outlook, 2027" published by Bonafide Research, the market was valued at around USD 19 billion in 2021, which is further anticipated to grow at more than 7% CAGR for 2022–2027. In the current market scenario, policy support plays a crucial role in driving the adoption of electric vehicles. Policy support enables market growth by making vehicles appealing to consumers, reducing risks for investors, and encouraging manufacturers to develop electric vehicles on a large scale. Moreover, improving technologies are expected to bring price-competitive electric vehicles to the market, creating demand for lithium-ion batteries in the coming years.

Even though the lead-acid battery segment has dominated the market with over half of the share for a decade, it has been encountering a steady decline in market share. The lithium-ion battery segment is expected to grow as the only segment in the regional market to display a double-digit CAGR through the forecasted period. This will be supported by rising demand and increased investments in the electric vehicle and renewable industries. The consumer market put aside, the largest users of primary batteries are the military, special emergency services, and forest fire fighters. High energy density, long storage, and operational readiness are among their strong attributes. The United States is already among the countries leading in global EV sales, along with other economies like Canada, which has already begun transforming its public transportation infrastructure for EVs. The United States is the dominant player in the North American battery market, contributing the highest share yet depicting the lowest historic CAGR in the market. New requirements regarding maximum permissible mercury limits and cadmium for primary power units and batteries for Mexico were established in 2019. There has been a great deal of talk about lithium in Mexico following the discovery of the world’s largest deposit in Bacadéhuachi, which has reserves calculated at 243.8 million tones of what can be termed as the oil of the future. In Canada, the shipping and importing of lithium batteries are subject to the Transportation of Dangerous Goods Act, 1992 and its regulations. They are now considered dangerous goods and the ban on transporting lithium-ion batteries as cargo on passenger aircraft is now legislated within the act. The United States government has been encouraging investors in electric vehicles (EVs) and renewable industries, resulting in an increased demand for battery-based energy storage systems, primarily led by lithium-ion batteries. In 2020, total electric car sales in Canada increased by more than 300% over 2017.In 2020, the country sold 36.9 thousand battery electric vehicles (BEVs).In June 2021, the United States Department of Energy (DOE) announced funding of USD 200 million over the next five years for electric vehicles, batteries, and connected vehicle projects at DOE national labs and new DOE partnerships to support electric vehicle innovation. Additionally, in October 2021, Toyota announced that it planned to invest approximately USD 3.4 billion in automotive batteries in the United States by 2030. Specifically, the investment focuses on developing and localizing automotive battery production for battery electric vehicles (BEV).

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Manmayi Raval

Research Consultant

The United States is one of the major hotspots for industrial batteries worldwide, on account of robust industrial infrastructure, surging deployment of battery-based energy storage projects, and expansion in renewable power infrastructure. To increase the adoption of clean energy systems and reduce GHG emissions, the country is increasing the deployment of solar and wind power installations, which need to be supported by energy storage systems. As of 2020, the United States had 118 GW of wind power installed capacity. The country has several battery-based energy storage projects under operation, including several battery technologies. From 2021 to 2024, around 14.5 gigawatts (GW) of battery storage power capacity is expected to come online in the United States. Around 9.2 GW of this storage capacity will be co-located with solar, 1.3 GW with wind energy, and the remaining 4 GW in a stand-alone capacity. Moreover, the requirement for data centres in the country is growing rapidly due to increasing connectivity and other factors, which means that roughly 600 zettabytes of new data are created each year (600 trillion gigabytes). In March 2021, Alphabet Inc. Class A’s subsidiary, Google Inc., announced that the company is planning to invest around USD 7 billion in the United States to build new offices and data centers. The development of data centres is expected to increase demand for UPS systems, thereby leading to a rise in demand for industrial batteries. Therefore, owing to the above points, the United States is likely to dominate the North American battery market, supported by increasing urbanization, consumer spending, and technologically advanced devices and vehicles. Several industry leaders are actively investing in the research and development of EV battery technology in North America. For instance, in January 2020, Tesla put forward a new patent for improved battery cell chemistry under the title "Dioxazolones and nitrile sulfites as electrolyte additives for lithium-ion batteries." This new battery technology is intended to increase the performance and service life of the batteries; it will also reduce the battery cost. Furthermore, the increasing number of pilot projects for the installation of charging infrastructures at various public places, an increasing number of buyers adopting EVs, growing government incentive programmes and subsidies on purchasing EVs, and increasing competition among industry leaders to launch new models is some of the key factors driving the growth of this market in this region.

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Major key players in the market are investing in EV battery development to support the increasing demand for EV batteries. For instance, in December 2019, General Motors Co. and LG Chem invested USD 2.3 billion to build a joint venture for an electric vehicle battery cell plant in Ohio (U.S.). This plant is aimed at creating the world’s largest battery facility for electric vehicles in Ohio. The joint venture will supply batteries to GM’s next generation of EVs. Furthermore, in May 2021, Ford Motor and SK Innovation announced a joint venture in the U.S. to produce battery cells for rechargeable EV batteries. Also, in May 2021, Ford Motor Co. and BMW AG invested USD 130 million in solid-state battery startup Solid Power. This initiative is to commercialize next-generation batteries. Moreover, in April 2021, LG Energy Solution and General Motors planned to build an EV battery plant in the U.S. with an investment of USD 2.3 billion. This new plant will increase GM’s production scale of batteries. In August 2020, Panasonic invested USD 100 million in an EV battery plant in the U.S. to boost the production capacity of batteries for Tesla. Also, in May 2021, Martinrea, an auto car manufacturer, and NanoXplore, a graphene producer, set up a joint venture called VoltaXplore in Canada to manufacture EV batteries with abilities such as improving charging times, range, longevity, and running at lower temperatures. Such advancements and developments in the EV battery industry are expected to increase the demand for batteries in the forecast period. The increase in the demand for high-quality rechargeable batteries accelerates the market's growth. The usage of these electronics and the use of lithium ion batteries as an indispensable component of electric vehicles (EVs) drive the market. Additionally, rapid urbanization, a change in lifestyle, a surge in investments, and increased consumer spending are expected to positively impact the lithium ion battery market. Furthermore, the use of LIB as a crucial component in grid energy storage extends profitable opportunities to the market players in the forecast period of 2022 to 2027. Also, an increase in the number of research and development initiatives by manufacturers for improvements in Li-ion batteries will further expand the market. Recent Developments • In July 2021, Burns & McDonnell completed the construction of Vistra's 100-MW/400-MWh battery energy storage system expansion at its Moss Landing Energy Storage Facility in California. The battery system stores power and releases it to California's grid when needed. • In October 2021, Samsung SDI and Stellantis NV announced that the companies had entered a memorandum of understanding (MOU) to form a joint venture (JV) to make battery cells and modules for North America. The plant is aiming to achieve an initial annual production capacity of 23 gigawatt-hours, with the ability to expand to 40 gigawatt-hours in the future. • In December 2019, XALT Energy launched XALT Battery Viewer (XBV) as a telematics system. The system is for battery-electric power-trains and can be used as a companion tool for the heavy-duty lithium-ion batteries. The new product increased the offerings of the company. • In 2021, the United States’ government announced to offer funds of $209 million for 26 new laboratory research projects relating to the electric vehicle battery and strengthen the domestic supply chain of lithium batteries. Further, the University of Texas at Austin researchers developed a stable sodium-based battery material that can recharge as efficiently as a conventional lithium-ion battery. Also, it has the potential for higher energy output compared to the current lithium-ion battery technologies. Hence, the country’s key research and development activities can fuel the growth of the studied market. In Canada, General Motors and POSCO Chemical announced to build a cathode material joint venture and use it as a facility to establish a supply chain for major battery materials in North America. As a part of the agreement, the companies plan to invest an estimated $400 million in the first phase for developing a large-scale plant in Canada and producing high nickel cathode materials used in General Motors’ electric vehicle batteries. Covid-19 Impact: The battery market was moderately impacted by the COVID-19 outbreak in Q1 of 2020. The market's growth declined due to the imposed lockdown that restricted the supply of batteries and other components as a result of severe disruptions in businesses and the global economy. The COVID-19 situation has exposed the over-dependency of countries, especially on China, for key raw materials. Major factors driving the market include declining lithium-ion battery prices, increasing adoption of electric vehicles, growing renewable energy sector, and increased sale of consumer electronics. Moreover, North America remains a pioneer in research and innovation in the global battery market and one of the largest consumers of batteries. On the other hand, the demand-supply mismatch of raw materials is expected to hinder the market’s growth during the forecast period. Major Companies Present In the Market A123 Systems LLC, BYD Company Limited, C&D Technologies Inc., Clarios, Contemporary Amperex Technology Corporation Limited, GS Yuasa International Limited, Hitachi Chemical Corporation Limited, LG Chem Limited, Panasonic Corporation, Saft Group SA, Samsung Corporation Limited, Sony Corporation, Toshiba Corporation Considered In the Report • Geography: North America • Historical year: 2016 • Base year: 2021 • Estimated year: 2022 • Forecasted year: 2027 Countries covered: • US • Canada • Mexico Aspects Covered In the Report • Market Size By Value for the historic time period (2016-2021) • Market Size By Value for the forecast time period (2022-2027) • Market Share by Type (Primary & Secondary) • Market Share by Technology (Lead acid Battery, Lithium ion Battery, Nickel metal hydride Battery, Nickel cadmium Battery & Other Batteries) • Market Share by Application (Automotive Batteries, Industrial Batteries & Portable Batteries) • Market Share by Country The approach of the report: We keep an eye on evolving markets and try to evaluate the potential of the products and services. If we find the market interesting, we start working on it and create the desired table of content, considering all aspects of the business. We start by creating separate questionnaires for C-level executives, national/regional sales personnel, company owners, dealers, distributors, and end-users. Once the questionnaires have been finalized, we start collecting the primary data (mostly through phone calls) and try to understand the market dynamics regionally or tier-wise. This process gives us in-depth details of the market, including all present companies, the top-performing products with reasons why they dominate; we get the details of new players and their innovative approaches; market trends; dynamics; and all the small details of the market. After the collection of primary inputs, we then cross-check the same with secondary sources that include associations, trade journals, annual reports, paid databases, newspapers, magazines, press releases, government sources, etc. From this, we get a rough estimate of the market and start checking existing product price variants, trade, production, raw material scenarios, policies and regulatory landscape, etc. Then, to finalize the market, we start collecting financials of each player present in the market, including limited, private limited, and LLPs. Moreover, we perform cross-industry and cross-region analysis of the product, and based on collected primary inputs and using statistical modeling, we start forecasting the market. We follow our forecasting algorithm, which is unique for each product but gives more weight age to primary inputs. At the same time, the content team starts preparing company profiles, market dynamics, market trends, five forces, PEST analysis, etc. Once the data is verified by the data expert, the team (primary team, content team, and data team) together crosscheck the segmentations, validate the market, and then the designing team starts plotting the graphs. Once the file is ready, the content team completes the report and makes sure that all the discussed points have been covered and provides their valuable inputs in the form of strategic recommendations for new as well as existing players. The QC team then checks the overall report that includes spell check, data verification, and makes the same dispatch ready and error-free. Intended Audience This report can be useful to industry consultants, manufacturers, suppliers, associations & organizations related to the battery manufacturers, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing & presentations, it will also increase competitive knowledge about the industry.