Increasing Sale of Electric Vehicles Driving Lead–Acid Battery Market Growth
In 2018, 5 million electric vehicles were sold across
the world, growing by 63% from the previous year, as per the International
Energy Agency. The key reasons behind their adoption are the air pollution
caused by the burning of fossil fuels in conventional vehicles and increasing
prices of crude oil. Be it a battery electric vehicle (BEV), hybrid electric
vehicle (HEV), or plug-in hybrid electric vehicle (PHEV), all of them use a
battery for motive power, instead of an internal combustion engine.
Thus, with a rise in EV sales, the lead–acid
battery market would grow to $70.7 billion by 2023 from $56.9 billion in
2017, at a 3.7% CAGR during 2018–2023. Such batteries use lead-peroxide and
sponge-lead plates, which are immersed in a sulfuric acid solution, to change
the chemical energy into electricity. Valve-regulated (VRLA) and flooded are
the two constructions in which such products are available. Of these, the
flooded variants saw higher adoption during 2013–2017 owing to their
cost-effectiveness.
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Motive, starting, lighting, and ignition (SLI), and standby are the three types of such batteries, if their actual purpose is considered. Among these, these batteries were the most widely installed for SLI purposes, during the historical period. Such devices are durable and cost effective, require low maintenance, and witness a high demand from the automotive sector. EVs have gained overwhelming support from national and provincial/state governments and international organizations, as they help reduce air pollution. Under the Electric Vehicles Initiative, China, Canada, France, Finland, India, Germany, Mexico, Japan, Norway, the Netherlands, the U.K., Sweden, and the U.S. have set targets to increase EV adoption.
Further, automakers such as Nissan Motor Corporation, Ford Motor Company, and Tesla Inc. are developing new EV models with higher range and speed, which is expected to attract consumers and drive the market for lead–acid batteries. Another reason for market growth is the rise in the demand for uninterruptible power supply (UPS). Several developing countries, including Mexico, India, South Korea, Indonesia, Vietnam, and Thailand, are witnessing rapid urbanization and industrialization. These processes result in the increasing demand for infrastructure for residential, commercial, and several other purposes, where UPSs are installed for stable power supply.
Industries such as manufacturing, research and
education, healthcare, oil and gas, and chemicals, also use UPSs. With the
growing demand for electricity, the pressure on power plants and the grid is
increasing. Additionally, in most developing countries and few developed
countries, the power infrastructure is aging, and both of these factors often
result in inconsistent power supply. This becomes a grave problem for oil and
gas installations, railways and airways, hospitals, and data centers, which is
automatically pushing the sale of backup systems, and, in turn, lead–acid
batteries.
Another sector where uninterrupted power supply is
imperative is telecom, especially in cell phone towers. Currently, diesel
generators are used at such places, but as they also cause air pollution, they
are being replaced by cleaner power sources. The India Brand Equity Foundation
(IBEF) claims that the country’s mobile industry would value $217.37 billion
(INR 14 trillion) by 2020. With the increase in smartphone sales, telecom
towers are increasing in number, which is pushing the demand for lead–acid
batteries for backup power systems. It is due to such factors that Asia-Pacific
would witness the fastest lead–acid battery market growth during the
forecast period.
Hence, the demand for such power sources would
continue surging with the increase in EV and smartphone adoption.
