Battery Packaging Market Size Forecast to Reach $56 Billion by 2027

Battery Packaging Market | IndustryARC
The Booming Automobile Sector Will Drive the Battery Packaging Market Growth.

The Battery Packaging Market size is forecast to reach US$56 billion by 2027 growing at a CAGR of 11.1% during 2022-2027. The demand for battery packaging is increasing globally due to the massive adoption of various types of batteries in several end-use industries. Automotive industries account for one of the largest consumers of battery packaging as different types of batteries are used in numerous vehicles. The automobile sector globally is expanding with an increase in production and sales, especially in the electric vehicle segment which requires lithium ion batteries in huge quantity and this will drive the market’s growth in the forecast period. For instance, as per the data by the China Association of Automobile Manufacturers, the annual sales volume of Chinese new energy vehicles is projected to reach 3 million units by 2025 compared to 1.2 million units in 2019. Furthermore, the consumer electronics sector is another major consumer of battery packaging as this industry implements a wide range of batteries in various electronic products. The consumer electronics sector is witnessing high demand globally and this will drive the growth of the market in the forecast period. For instance, according to the July 2021 data by China.org.cn, exports in consumer electronics witnessed a growth trajectory for 12 months in a row. Lithium ion batteries will witness the highest demand in the forecast period. Nickel metal hydride batteries is projected to witness significant demand in the forecast period. Cardboard material will witness the maximum demand in the forecast period. Polyethylene terephthalate and polyvinyl chloride materials will witness significant demand in the forecast period. The price fluctuation of raw materials might hamper the growth of the market in the forecast period.

COVID-19 Impact

The battery packaging market was moderately affected by the COVID-19 crisis. Disruption in the supply chain, idling of factories, and raw material procurement are some of the key challenges surfaced in the market amid the pandemic. Global market players implemented quick response models to keep their businesses and service afloat. As per the April 2020 report about COVID-19 response by Rogers Corporation, the company’s China campus started operating again amid the pandemic. The market was slowed down with reduced demand for batteries from the automotive sector as this sector witnessed a drop in automobile production. Going forward the market is projected to gain a robust growth rate as the automobile and consumer electronics sector is on a progressive track in the forecast period.

Battery Packaging Market – By Battery Type

The lithium ion batteries segment dominated the battery packaging market in 2021 and is growing at a CAGR of 14.2% in the forecast period. This type of battery is well equipped for applications requiring high energy density solutions like electric and hybrid automobiles. Moreover, lithium ion batteries are fast charging, lightweight, and long-lasting than traditional battery technology. Owing to such superior properties, the demand for lithium ion batteries is growing among automobile and battery manufacturers. For instance, in October 2019, Maruti Suzuki collaborated with Toshiba Corp. and Denso Corp. to set up India’s first lithium-ion battery manufacturing plant for electric vehicles. There has been a flurry of investment for expanding the lithium ion battery portfolio and the booming global automobile sector will propel the exponential growth of lithium ion battery segment in the forecast period. Nickel metal hydride and lead-acid batteries will witness significant demand in the forecast period.

Battery Packaging Market – By Casing

Cylindrical casing dominated the casing segment in the battery packaging market in 2021. This type of battery case comes with the highest standard safety installations like a safety valve and a current interrupt device. Furthermore, lower energy stored of cylindrical cells enables the cylindrical-based battery packs with better heat dissipation and withstanding high pressure. These robust properties make cylindrical casing one of the most commonly used types of a casing for lithium-ion batteries. As per the June 2020 journal by the Journal of Welding and Joining (JWJ), a successful joining of the battery cell and the thin tab was done with the use of a cylindrical casing. Such involvement of cylindrical casing will increase its demand in the forecast period in the battery packaging market. 

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Battery Packaging Market – By Material

Cardboard material dominated the battery packaging market in 2021. The type of material comes with moisture soaking capacity which protects the batteries from getting damaged. Moreover, cardboard material is cost-effective, sustainable, and offers robust structural strength to the package. Such high qualities of cardboard material make it a desirable choice among market players. For instance, in January 2020, DS Smith Technicarton developed a new sustainable cardboard-based packaging solution for Groupe PSA car batteries. Such development will increase the high usage of cardboard material in the battery packaging market in the forecast period. The metal segment is projected to witness significant demand in the battery packaging market in the forecast period owing to its high compatibility and robust security. Polyethylene terephthalate and polyvinyl chloride will witness significant demand in the battery packaging market during the forecast period.

Battery Packaging Market – By Geography

The Asia-Pacific region held the largest market share in the battery packaging market in 2021 with a market share of up to 34%. The high demand for battery packaging is attributed to the increasing use of batteries in the booming automotive sector in this region. For instance, as per the data China Association of Automobile Manufacturers, in September 2021, production of Chinese commercial vehicles touched 310000 units, increasing 35.5% month on month. Similarly, as per the data by the India Brand Equity Foundation, passenger vehicles sale in the Indian market increased as 261,633 units sold in April 2021, acquiring a market share of 12.9%. Such a boost in the production of automobiles will increase the uses of batteries such as lithium Ion batteries, lead-acid, and silver oxide, ultimately increasing the demand for battery packaging. The European region will witness robust demand for battery packaging owing to the rise in consumer electronics demand in the region.

Battery Packaging Market Drivers

The booming automobile sector will drive the market’s growth

Battery packaging is extensively associated with the automobile sector as a variety of batteries such as lithium Ion batteries, lead-acid, and silver oxide find their high uses in multiple vehicles. The automotive industry globally is booming with increasing production and sales and this will drive the market’s growth in the forecast period. For instance, according to the July 2021 data by the European Automobile Manufacturers Association, in June 2021, passenger car registrations increased with Germany witnessing the highest demand in the passenger car with a 24.5% surge, followed by Spain (+17.1%) and Italy (+12.6%). Similarly, as per the data by Autohome Inc., annual sales in Chinese passenger vehicles are projected to reach 30 million units by 2029 which was 21.44 million units in 2019. Such a massive boost in the global automobile sector will augment the high utilization of batteries which in turn will increase the need for battery packaging, ultimately contributing to the market’s growth in the forecast period.

Expanding consumer electronics sector will drive the market’s growth

Battery packaging find its massive application in the consumer electronics sector as various batteries are utilized in numerous consumer electronic products. The demand for consumer electronics is on the rise globally and this will drive the growth of the market. For instance, according to September 2021 data by China.org.cn, China’s Zhejiang witnessed a surge in online retail sales in which consumer electronics ranked in the top categories. Similarly, as per the September 2021 data by the UK’s Office for National Statistics, consumer electronics import value in the European Union was 109.2 in the first quarter of 2021 which was 108.4 in the first quarter of 2020. This high demand for consumer electronics globally will amplify the uses of batteries in several consumer electronics goods, increasing the requirement of battery packaging and this, in turn, will drive the growth of the battery packaging market in the forecast period.

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Battery Packaging Market Challenges

Raw material price fluctuation might hinder the market’s growth

The market involves raw materials such as polypropylene, polyethylene, polyvinyl chloride, and polyethylene terephthalate. These are petroleum-derived materials whose prices are fluctuating due to the volatility in petroleum prices and this might hamper the growth of the market in the forecast period. During the pandemic, petroleum prices plunged historically owing to lockdown and supply chain restrictions. According to the stats by ourworldindata.org, the price of crude oil in 2017 stood at USD 54.19 per barrel which jumped to US$ 64.21 per barrel in 2019. Later, in 2020, the oil price again lowered to US$ 41.84 per barrel. These fluctuations in oil prices lead to volatility in petroleum prices, thereby fluctuating the prices of raw materials. Such fluctuation in the raw material prices might affect the growth of the battery packaging market in the forecast period.

Battery Packaging Market Industry Outlook

Investment in R&D activities, acquisitions, product and technology launches are key strategies adopted by players in the Battery Packaging Market. Major players in the battery packaging market are:

Nefab
Wellplast AB
C.L. Smith
DGM USA
Soehner Kunststofftechnik GmbH
GWP Group
Fedex
DHL
DS Smith
Rogers Corporation
United Parcel Service
Amara Raja Batteries
Manika Moulds
Smurfit Kappa
Targray Industries
Heitkamp and Thumann KG
Others

Recent Developments

In November 2020, US-based United Parcel Service which deals with battery packaging and shipping service, opened its new package sorting and delivery hub in Canada. This development will contribute to the expansion of the battery packaging market in the forecast period.

Key Takeaways:

Lithium ion battery is leading the battery packaging market. This type of battery offers high efficiency and energy density compared to other battery types, making it a suitable choice in various end-use applications.

The automotive sector will drive the growth of the market in the forecast period. As per the July 2021 statistics by the European Automobile Manufacturers Association, registration in passenger cars in the European region jumped by 25.2% in the first of 2021.

The Asia-Pacific region will witness the highest demand for battery packaging owing to the increasing uses of batteries in the region’s expanding automotive sector. According to the report by the China Association of Automobile Manufacturers, in September 2021, production of Chinese passenger vehicles touched 1.767 million units, increasing 18.1% month on month.

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