Sep. 23, 2024
In this article, we explore the landscape of lithium battery production across various countries. If you are interested in detailed insights about leading nations in lithium battery manufacturing, feel free to navigate to Lithium Battery Production by Country: Top 5 Countries.
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Several nations play pivotal roles in the battery technology manufacturing sector, capturing significant portions of the global market. These countries host substantial battery manufacturers and possess well-established supply chains and infrastructure to facilitate large-scale battery production. Key players in this industry include China, Japan, South Korea, the United States, Germany, and India, which together house major electric vehicle manufacturers, such as Tesla, Inc. (NASDAQ:TSLA), Ford Motor Company (NYSE:F), and XPeng Inc. (NYSE:XPEV).
We have previously discussed the ten most advanced battery technologies in detail. Battery manufactories are distributed globally, producing an array of battery types including lithium-ion, lead-acid, and nickel-metal hydride batteries, among others. Additionally, several smaller nations have ventured into battery production and development, reacting to the technological advancements that continue to emerge in the industry.
Currently, Chinese firms dominate the electric vehicle (EV) battery market, monopolizing 56% of the market share. Out of the ten largest battery manufacturers worldwide, four are located in China. Companies from South Korea and Japan also maintain a strong presence in this market. In the United States, significant players include QuantumScape, A123 Systems, Enovix, SES AI, and Amprius Tech.
Chile boasts the largest known lithium reserves globally, totaling 8 million tons, followed by Australia (2.7 million tons), Argentina (2 million tons), and China (1 million tons). Europe also has lithium deposits, albeit on a smaller scale, notably in Portugal.
The global battery technology market is anticipated to expand from $95.7 billion to $136.6 billion, reflecting a compound annual growth rate (CAGR) of 7.4%. The increasing adoption of electric and hybrid vehicles, along with rising demand for wearable devices, is pushing growth in the battery technology sector. Other emerging sectors, such as solar and wind energy systems, also contribute to the shift towards environmentally sustainable energy solutions.
Key drivers for the overall growth of the EV battery market include global EV adoption, declining battery prices, and heightened investments from leading automobile OEMs. Additional aspects propelling market growth involve substantial investments in expanding lithium-ion battery capacity, the emergence of battery-as-a-service models, and greater acceptance of electric mobility in developing countries.
However, the EV market faces challenges such as the relatively low energy density of batteries, potential shortages in lithium mining capacity, and safety concerns regarding EV batteries, which could impede market expansion. In terms of EV battery production by country, Chinese companies continue to lead with their 56% market share, dominating the industry landscape.
South Korean firms accounted for 26% of global EV battery production. Notable players include Samsung SDI, SK On, and LG Energy Solutions, which supply EV batteries to major automotive brands like Tesla, Ford, and General Motors. Japanese companies also play a crucial role in the EV battery sector, contributing 10% to the world's output, with Panasonic ranking fourth among the largest battery manufacturers.
Currently, there is an aggregate of 948 GWh of lithium-ion (Li-ion) battery capacity available globally, with approximately 274 GWh of this utilized specifically for EV batteries. As trends in EV adoption and e-mobility rise, it is estimated that several thousand GWh of batteries will be required to support the influx of millions of new EVs annually.
From 2021 to 2030, the demand for Li-ion batteries in light vehicles is projected to grow at an approximate CAGR of 40%, reaching around 2,050 GWh according to S&P Global Mobility predictions. Concurrently, installed battery capacity is expected to swell by 23.5% CAGR to 3,371 GWh by 2030.
The Asia-Pacific region is home to the largest producers of lithium batteries. Major companies leading this market include CATL and BYD, which boasted production capacities of 137.7 GWh and 51.5 GWh respectively in 2021. The US produced 44 GWh of lithium-ion batteries that year, with forecasts suggesting that this could nearly double to 91 GWh by 2025 due to advancements in technology. Importantly, the US is at the forefront of developing cutting-edge battery technologies.
Our Methodology
These insights were derived from a thorough evaluation of the battery industry. Details about each country's standing and the leading firms in the sector provide readers with context that can aid their investment decisions. Countries are ranked based on their global share of lithium-ion battery manufacturing capacity in 2021.
Share of global lithium-ion battery manufacturing capacity in 2021: 0.1%
In 2021, mines in Western Australia produced nearly half the world's lithium, estimated at 55,000 metric tons. The number of lithium battery manufacturing plants has surged in Australia in recent years. This lithium is vital for electric vehicles and various battery applications. Australia's lithium production is projected to grow by 24.5%, reaching 68.45 thousand tonnes in 2022, and is set to expand at a CAGR of 14.2% to hit 116.24 kt in 2025.
The largest lithium mining entity in Australia is Pilbara Minerals, which produces over 377,000 metric tons of lithium annually. Greenbushes, recognized as Australia's largest lithium mine, contributed to the country's 55,000 tonnes of lithium output in 2021. Australia has supplied roughly half of the globe's lithium demands.
Australia is also home to numerous emerging battery startups such as Evergreen, Greensync, Carnegie Clean Energy, and RayGen. Energy Renaissance manufactures climate-optimized lithium-ion batteries for various users. Notably, the Victorian Big Battery in Australia can store enough energy to supply over one million homes for half an hour, with a capacity of 100 MW/129 MWh.
Similar to Tesla, Inc. (NASDAQ:TSLA) and Ford Motor Company (NYSE:F) in the US, Australia hosts some of the most significant battery enterprises globally.
Share of global lithium-ion battery manufacturing capacity in 2021: 0.3%
The UK boasts several EV battery manufacturers, including British Volt, Aceleron, and Williams Advanced Engineering. As the world progressively transitions from fossil fuels to renewable resources, the UK government plans to ban diesel and gasoline car sales by 2030, increasing demand for batteries across automotive, aerospace, and electrical utilities sectors.
The UK government has pledged nearly £500 million for battery mass production over the next four years. British Volt is planning to establish a £2.6 billion Gigafactory in Northumberland, aiming to produce 300,000 lithium-ion battery packs annually for the electric vehicle sector.
Share of global lithium-ion battery manufacturing capacity in 2021: 0.6%
Sweden hosts numerous EV battery enterprises. In August 2021, the country recorded a 46.1% share of electric vehicles in its auto market. Volvo Group initiated plans to construct a large-scale battery cell factory in Sweden, intending to manufacture cells specifically for commercial vehicle applications by 2025.
Northvolt AB, a Swedish battery company, aims to achieve battery production with an 80% lower carbon footprint. The company's goal is to reach an annual output of 150GWh by 2025, with Northvolt Ett targeting 16GWh production per year.
Share of global lithium-ion battery manufacturing capacity in 2021: 1.6%
Germany excels in technological innovation within the electric vehicle sector. Major car manufacturers such as Volkswagen and Tesla operate within the country. Millions of tons of lithium are sourced from distant locations annually to manufacture lithium-ion batteries for electric vehicles, grid energy storage, and wearable tech.
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Research scientists have developed minimally invasive techniques to extract lithium from geothermal plants in Germany. This technology has the potential to enable the extraction of thousands of tons of lithium from the Upper Rhine trench in Germany and France annually.
The German government has also set a budget of $6.1 billion over three years to significantly enhance the number of electric vehicle charging points across the nation, aiming to increase the existing 70,000 charging stations to 1 million by 2025. Additionally, Germany plans to have 15 million electric vehicles on the road within the same timeframe, up from the current count of 1.5 million.
Share of global lithium-ion battery manufacturing capacity in 2021: 2.4%
Japan has significantly benefited from the rising demand for EV batteries and consumer electronics, with an annual battery output worth approximately 930 billion Japanese yen (JPY). The country's battery industry encompasses various types, from button cells to lead-acid batteries.
Several leading global battery companies operate in Japan, including Panasonic, Murata, and Kyocera. Panasonic alone holds a 10% market share and was the sole battery supplier for Tesla in the past. The company is collaborating with Tesla to produce a new battery design expected to yield a double diameter compared to standard types, projecting to triple its battery production by 2024.
Like other countries noted, Japan is home to some of the largest battery firms globally, including Tesla, Inc. (NASDAQ:TSLA), Ford Motor Company (NYSE:F), and XPeng Inc. (NYSE:XPEV).
Click to continue reading and see Lithium Battery Production by Country: Top 5 Countries.
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Disclosure. None. Lithium Battery Production By Country: Top 12 Countries is originally published on Insider Monkey.
February 12, 2021
Lithium is a crucial element in clean energy technologies, powering everything from electric vehicles (EVs) to large batteries for energy storage at power plants. Although it is abundantly available, extraction and processing are required before use.
There are two primary methods for extracting lithium: brine extraction and hard rock mining. For many years, Chile has been the leader in lithium mining, where brines—salty water found on the earth's surface or underground—are utilized. Lithium-rich brine is pumped from the ground and transferred to evaporation pools, where water evaporates, leaving lithium and other minerals.
Alternatively, in Australia, which surpassed Chile as the largest lithium producer in 2021, lithium is extracted from a mineral called spodumene. In Australia, around half of the world's lithium supply is sourced. Over 80% of the mined rock is sent to China for further processing to extract lithium.
Though Chile and Australia are the front-runners, rising clean energy demands have encouraged other countries to explore lithium mining. Global lithium production has surged from around 37,000 tonnes a decade ago to 130,000 tonnes now.
There's been a surge in proposed lithium mining projects in many countries, reflecting this growing demand.
Both methods of extraction bring with them environmental and social challenges. Over 60% of global lithium stores are found in the 'lithium triangle' in South America, often in ecologically sensitive regions. Mining operations can disrupt local ecosystems, and though hard rock mining consumes more freshwater, both methods demand significant water resources, which may be limited in some areas. In brine extraction zones, considerable brine depletion can occur, impacting local ecosystems.
From an energy perspective, brine mining is considerably less energy-intensive than hard rock mining, which relies on heavy machinery to excavate and process rock. Studies indicate that lithium from brine typically generates about 11 tons of carbon dioxide emissions per ton of lithium, while hard rock mining results in around 37 tons of CO2 emissions for each ton extracted.
The social ramifications of lithium extraction depend on corporate practices and regulatory frameworks. Ideal scenarios involve local communities benefiting economically from lithium mining, rather than bearing cleanup costs alone. In California, potential brine lithium extraction projects have led to new regulations aimed at directing some revenue towards local communities for environmental restoration and related projects.
The effects of these regulations remain to be seen, and experts stress the necessity of involving local communities in the planning stages of extraction projects to mitigate risks to marginalized groups and cultures.
Innovative methods of lithium extraction, such as direct lithium extraction that employs specific filters to separate lithium from brine, are being tested. These techniques generally have a smaller environmental footprint and can recycle water during the process. Additionally, discussions around recovering lithium from old waste are gaining traction.
Moreover, finding approaches to reduce lithium demand could support more responsible and sustainable mining practices. For instance, promoting public transportation, minimizing EV battery sizes, and enhancing recycling efforts could substantially decrease lithium reliance while still allowing progress toward climate goals.
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