- Chinese battery suppliers held nearly two-thirds of the EV battery market.
- Tesla, BYD and Volkswagen installed nearly 45% of total EV batteries in H1 2023
The global EV battery capacity sold in H1 2023 grew 54% YoY to reach over 300GWh, according to the latest research from Counterpoint’s Global EV Battery Tracker. During this period, global EV sales also experienced a substantial 43% YoY growth. CATL led the EV battery market, with BYD and LG Energy Solutions trailing by some distance. These top three companies collectively accounted for nearly two-thirds of the market in H1 2023. The leading regions in terms of EV battery installations were China, US and Europe.
Commenting on the market dynamics, Senior Analyst Soumen Mandal said, “The EV battery ecosystem is undergoing rapid transformation. Over the next few years, numerous new battery suppliers, such as ACC, Verkor, Northvolt and E4V, are expected to secure a substantial presence within the battery supply chain. Apart from specialist battery suppliers, automakers such as Tesla, Volkswagen, BMW, Mercedes-Benz and Stellantis are also working on in-house cell and pack manufacturing, which will make the battery supply chain even more competitive.”
Currently, Chinese and South Korean suppliers dominate the industry. Chinese companies like CATL, BYD, CALB, Gotion, Sunwoda and Farasis collectively hold two-thirds of the market, while the three major South Korean players – LG Energy Solution, Samsung SDI and SK Innovation – account for around 25% market share. As EV sales gain momentum in various parts of the world, countries will try to establish self-sustaining battery supply chains. This will allow local industry participants to thrive while forcing some players to exit the market due to heightened competition.
Automakers Tesla, BYD and Volkswagen accounted for nearly 45% of the total EV battery capacity sold in H1 2023. The surging sales of Tesla’s Model 3 and Model Y have played a pivotal role in driving the growth of CATL and LG Energy Solutions. CATL supplies batteries for the standard versions of the Model 3 and Model Y manufactured at Tesla’s Shanghai factory, while LG Energy Solutions serves as the primary battery supplier for the performance versions of the Model 3 and Model Y. On the other hand, Hyundai, Kia and Ford‘s EVs have played an active role in boosting the market share of SK Innovation, while Rivian and BMW predominantly rely on Samsung SDI as their battery supplier. In the North American region, Panasonic holds a key position as the primary supplier of batteries for Tesla models.
Research Vice President Peter Richardson said, “In H1 2023, the average battery capacity of EVs stood at 50kWh. The rising sales of small, compact and mini EVs, particularly in China, are expected to maintain the average battery capacity in the range of 65kWh to 70kWh by 2030. Consequently, we expect that the total EV-driven battery demand will reach 4TWh in 2030.”
Richardson added, “The increasing demand for batteries, coupled with geopolitical tensions, is exerting upward pressure on the prices of lithium, a primary component of EV batteries. As an alternative, battery suppliers are looking for different chemistries like sodium-ion (NA-ion) that could drive down the cost of batteries and make EVs more affordable. CATL has already achieved a breakthrough in sodium-ion battery chemistry, and we expect to see the mass adoption of such batteries very soon. Since the low energy density of NA-ion compared to lithium-ion doesn’t make it suitable for performance EV models, we expect to see higher usage of NA-ion batteries in electric two-wheelers, three-wheelers and small passenger cars. A model of Chery’s iCar brand is expected to be equipped with CATL’s sodium-ion battery and go on sale in early 2024. On the other hand, solid-state batteries are still under development and will take some time before becoming available commercially. Making solid-state batteries affordable is the main challenge.”