PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1511355
PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1511355
According to Stratistics MRC, the Global Industrial Traction Battery Market is accounted for $4.66 billion in 2024 and is expected to reach $11.65 billion by 2030 growing at a CAGR of 16.5% during the forecast period. Industrial traction batteries are robust energy storage devices designed to power heavy-duty electric vehicles and equipment in industrial settings. These batteries are built to withstand demanding conditions, providing reliable power for prolonged periods. Typically employing lead-acid or lithium-ion technology, they offer high energy density and efficient performance, crucial for sustaining uninterrupted operations.
According to a research published by the Indian Ministry of Commerce and Industry, the transport sector in India is expected to grow at a CAGR of 5.9%. According to the Net Zero Emissions by 2050 Scenario, 300 million electric automobiles will be on the road by 2030. According to an International Energy Agency report, electric cars (EVs) will account for more than 60% of worldwide vehicle sales by 2030.
Focus on green technologies
The focus on green technologies is a key driver in the industrial traction battery market due to the increasing emphasis on sustainability and environmental responsibility. Companies are seeking eco-friendly solutions to power their operations, leading to a growing demand for electric vehicles and machinery powered by industrial traction batteries. This trend is fueled by regulatory initiatives promoting cleaner energy alternatives as well as a shift towards reducing carbon footprints. Additionally, advancements in green technologies have improved the efficiency and reliability of industrial batteries, making them more appealing to businesses looking to optimize their operations while minimizing their environmental impact.
High initial cost
The high initial cost restraint in the industrial traction battery market are the significant upfront investment required to purchase these batteries. Industrial-grade traction batteries are designed for heavy-duty applications, such as forklifts and material handling equipment, necessitating robust construction and high power output. This results in higher manufacturing costs, which are passed on to consumers. Consequently, businesses may be deterred from investing in these batteries by opting for cheaper alternatives or delaying upgrades, despite their long-term efficiency and durability benefits. This cost barrier often requires careful consideration and financial planning by industrial operators before committing to such purchases.
Expansion of E-commerce and warehousing
The expansion of e-commerce has led to a surge in demand for efficient warehousing solutions, driving the growth of the industrial traction battery market. These batteries power material handling equipment like forklifts and pallet jacks essential to warehouse operations. With the increasing need for faster order fulfillment and streamlined logistics in e-commerce, the demand for such batteries is projected to rise significantly. Additionally, the shift towards electric vehicles in various industries further amplifies this demand. This presents a lucrative opportunity for manufacturers and suppliers in the industrial traction battery market to capitalize on the evolving needs of the e-commerce and warehousing sectors.
Competitive pressure
In the industrial traction battery market, competitive pressure is due to the intense rivalry among companies vying for market share. As demand for industrial batteries grows, so does the number of players entering the market, increasing competition. This competition manifests in aggressive pricing strategies, innovative product offerings, and marketing campaigns aimed at capturing customers. Additionally, established players may face threats from new entrants or disruptive technologies, further heightening competitive pressure. To thrive in such an environment, companies must continuously innovate, optimize production processes, and build strong customer relationships to withstand the challenges posed by competitive pressure.
The COVID-19 pandemic significantly impacted the industrial traction battery market. Initially, widespread lockdowns disrupted manufacturing operations and supply chains, leading to a slowdown in demand for industrial equipment and machinery powered by traction batteries. With many industries reducing or halting production, the need for replacement batteries has also decreased. However, as economies gradually reopened, there was a surge in demand for essential goods and services, prompting industries to ramp up operations again, thus boosting the need for industrial traction batteries. Additionally, the pandemic accelerated the adoption of automation and electric vehicles in warehouses and logistics, further driving demand for traction batteries with enhanced efficiency and sustainability features.
The lithium-ion segment is expected to be the largest during the forecast period
The growth of the lithium-ion segment in the industrial traction battery market can be attributed to the lithium-ion batteries offering for higher energy density and longer cycle life compared to traditional lead-acid batteries, making them more efficient and cost-effective for industrial applications. The increasing demand for electric vehicles and material handling equipment in industries such as manufacturing, warehousing, and logistics has driven the adoption of lithium-ion batteries due to their lighter weight and faster charging capabilities. Additionally, advancements in battery technology and declining prices of lithium-ion batteries have further fueled their adoption in the industrial sector.
The electrical vehicle segment is expected to have the highest CAGR during the forecast period
The growth of the Electrical Vehicle (EV) segment within the Industrial Traction Battery market is driven by increasing environmental awareness and government regulations promoting cleaner transportation options and the adoption of electric vehicles across the globe. Additionally, advancements in battery technology, such as higher energy density and longer lifespans, have enhanced the feasibility and attractiveness of EVs to consumers and businesses alike. Moreover, the expanding infrastructure for charging stations is alleviating range anxiety, further boosting EV sales. As industries pivot towards sustainable practices, there's a growing demand for electric forklifts and other industrial vehicles, propelling the growth of the EV segment in the Industrial Traction Battery market.
The growth of the industrial traction battery market in North America can be attributed to the region's heightened focus on sustainability and reducing carbon footprints, driving industries towards electric-powered equipment. Additionally, advancements in technology have improved the performance and efficiency of industrial traction batteries, making them more appealing to businesses. Moreover, government initiatives and incentives promoting the adoption of electric vehicles and machinery have spurred market growth. The increasing demand for electric forklifts, AGVs (Automated Guided Vehicles), and other industrial equipment further propels the expansion of the market in the region.
The Asia-Pacific region has witnessed significant growth in the industrial traction battery market due to rapid industrialization and urbanization across countries like China, India, and Japan that have fueled the demand for electric material handling equipment, driving the need for industrial traction batteries. Additionally, stringent environmental regulations promoting clean energy solutions have encouraged industries to adopt electric-powered machinery, further boosting the market. Moreover, advancements in battery technology, such as improved energy density and a longer lifespan, have made electric-powered equipment more viable and cost-effective for industries in the region.
Key players in the market
Some of the key players in Industrial Traction Battery market include A123 Systems LLC, BYD Company Limited, Contemporary Amperex Technology Co. Limited (CATL), EnerSys, Exide Technologies, GS Yuasa Corporation, Hitachi Chemical Co., Ltd., Johnson Controls International plc, Kokam Co., Ltd., Leoch International Technology Limited, LG Chem Ltd., Panasonic Corporation, Saft Group S.A., Samsung SDI Co., Ltd., Tesla, Inc., Toshiba Corporation and Trojan Battery Company.
In April 2024, Tesla has inked a strategic agreement with Tata Electronics to acquire semiconductor chips for its global operations. This agreement, executed discreetly a few months ago, holds significance as it positions Tata Electronics as a supplier for top-tier global clients seeking to establish a pivotal segment of their semiconductor value chain within India. The EV major is eager to enter India, which stands as the world's fastest-expanding automotive market.
In April 2024, Trojan Battery Company picked up the 2024 BCI Amplify Award for its public relations campaign to generate awareness for its new Trojan advanced energy storage (AES) AGM battery. It received the award at the centenary convention put on by Battery Council International (BCI) in Fort Lauderdale, Florida.