EV Battery market soars 54% in H1 2023, CATL leads

The electric vehicle (EV) industry has witnessed a remarkable surge in the first half of 2023, with EV battery sales growing by an impressive 54% year-over-year, reaching over 300 GWh. This surge is closely aligned with the 43% increase in global EV sales during the same period, as detailed by Counterpoint's Global EV Battery Tracker.
At the forefront of this growth is CATL, a Chinese battery giant, which has established itself as a market leader. Other prominent players include BYD and LG Energy Solutions, with these top three companies collectively holding nearly two-thirds of the market share in the first half of 2023. This dominance signifies a significant concentration of market power in the hands of a few key players.

Counterpoint underscores a dynamic shift in the EV battery ecosystem, emphasising the entry of new battery suppliers like ACC, Verkor, Northvolt, and E4V. These emerging players are expected to secure a substantial presence within the battery supply chain in the coming years. Furthermore, major automakers such as Tesla, Volkswagen, BMW, Mercedes-Benz, and Stellantis are venturing into in-house cell and pack manufacturing. This diversification is set to intensify competition in the battery supply chain.

The current market is predominantly led by Chinese and South Korean suppliers. Chinese companies like CATL, BYD, CALB, Gotion, Sunwoda, and Farasis collectively account for a significant market share, while South Korean giants LG Energy Solution, Samsung SDI, and SK Innovation cover around 25% of the market. Mandal predicts a shift in the global landscape as countries strive to develop self-sufficient battery supply chains, which could result in heightened competition and potential market exits for some players.

In terms of automotive companies’ contribution, Tesla, BYD, and Volkswagen were significant players, accounting for nearly 45% of the total EV battery capacity sold in H1 2023. The popularity of Tesla’s Model 3 and Model Y, particularly those manufactured at Tesla’s Shanghai factory, has played a pivotal role in driving the growth of CATL and LG Energy Solutions. Other brands like Hyundai, Kia, and Ford have boosted the market share of SK Innovation, while Rivian and BMW have predominantly relied on Samsung SDI for their battery needs. In North America, Panasonic maintains a key position as the primary supplier for Tesla models.

The average battery capacity of EVs, which was 50kWh in H1 2023, will likely stabilise at 65kWh to 70kWh by 2030. This stability is attributed to the rising sales of small, compact, and mini EVs, especially in China. The overall EV-driven battery demand is expected to skyrocket to 4 TWh by 2030, marking a significant milestone in the industry.

The rising demand for batteries is impacting the prices of lithium, an essential component of EV batteries. In response, suppliers are exploring alternative chemistries like sodium-ion (NA-ion) to reduce costs and make EVs more accessible. CATL is already making strides in this area, with the expectation of mass adoption of NA-ion batteries soon, particularly in electric two-wheelers, three-wheelers, and small passenger cars.

Source: Counterpoint research

Source: Counterpoint research
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