(December 2007) According to a new and updated technical market report, Lithium Batteries: Markets and Materials (FCB028D) from BCC Research , the lithium battery material market was worth more than $3.4 billion at the wholesale level in 2000 and grew to over $5.6 billion in 2006. It will reach $7.5 billion through 2012, a compound annual growth rate (CAGR) of 5.3%. To put this in perspective, BCC estimates that the entire U.S. battery market was worth nearly $33 billion in 2006 ( much of this for lead-acid automotive batteries).
Nonrechargeable (primary) lithium batteries were worth $975 million in 2006 and the world market should grow to a projected $1.2 billion (constant 2006 dollars) in 2012, a CAGR of 3.7%.
The rechargeable secondary lithium battery market was approximately $4.6 billion in 2006 but should grow to more than $6.3 billion by 2012, a CAGR of 5.6%.
Just as lithium batteries replaced nickel-based primary batteries for many applications, current lithium-ion battery designs are beginning to be replaced by advanced lithium-ion chemistries like lithium phosphate, lithium iron phosphate, and especially lithium polymer systems.
(December 2007) Demand for batteries in China is forecast to increase 13.2 percent annually to 110 billion yuan in 2010. Growth stimulants include the emergency of electric bicycles as important means of transportation and strong domestic demand for consumer battery-powered
Sales of secondary batteries are forecast to rise 14.3 percent annually through 2010 to 82.1 billion yuan. Although lead-acid batteries will account for more than 43 percent of all secondary battery sales in 2010, rechargeable lithium and nickel-metal hydride batteries will experience stronger growth. Demand for these types of advanced batteries will be heavily influenced by their high-performance attributes - such as higher power density and longer product lifecycle than traditional lead-acid and nickel-cadmium batteries - as well as by continuing technical innovation and decreasing prices.
Zinc-carbon/chloride batteries will continue to dominate the primary battery market in unit terms, though alkaline batteries will surpass zinc-carbon/chloride cells in the market value, and comprise the largest share of demand in 2010. Alkaline and more advanced primary batteries - such as lithium and silver oxide - are projected to grow at higher rates than other primary batteries. Alkaline batteries are favored for their greater power and longer lifespan than zinc-carbon/chloride batteries.
Consumer applications will comprise two-thirds of primary battery sales in 2010, continuing the historical trend. Demand for primary batteries will be fueled by an ever-increasing number of battery-powered portable devices introduced into the growing Chinese market - such as MP3 players and digital cameras. Unlike the U.S., in China primary batteries rather than more expensive secondary batteries commonly power these devices. The domestic market for secondary batteries used in transportation equipment is forecast to increase more than 18 percent annually through 2010 to 32.7 billion yuan, registering the fastest growth among secondary battery markets. Market gains will be driven by the meteoric rise of electric bicycles, as well as strong growth in production of motor vehicles
The China Industrial Association of Power Sources reports that 28 billion units of batteries were produced in mainland China in 2004. According to China Customs’ statistics, mainland China’s battery production volume currently represents at least 25 percent of the global supply. Research and Markets discusses information gathered from 151 Chinese battery makers in its report, “Batteries in China and Taiwan.” Some of the findings in the report include:
• Alkaline batteries - Mainland China is the world’s largest Alkaline battery supplier, with output of primary cells reaching 22 billion units in 2004. Production is expected to increase by 10 percent in 2005.
• Nickel-metal hydride batteries - Some 800 million units of Nickel-metal hydride batteries were manufactured in mainland China in 2004. The regions’ Nickel-metal hydride battery output accounted for 40 percent of the global supply in 2004. During that same year, the value of the exports totaled 675 million units, valued at $442 million. Approximately 60 new entrants planned to include Nickel-metal hydride batteries in their product lines in 2005.
• Sealed Lead-acid batteries - About 30 percent of the world’s requirement for sealed Lead-acid batteries is supplied by mainland China. Sealed Lead-acid battery shipments totaled about 107 million units in 2004. This was a 25 percent increase from 2003. In 2005 and 2006, electric vehicles, UPS (Uninterruptible Power Supplies), emergency lighting, security systems and industrial applications will drive demand for these batteries.
• Nickel-cadmium batteries - Mainland China’s production volume of these batteries hit one billion units in 2005. Nickel-cadmium battery production in mainland China is set to grow by 5 to 10 percent in the next five years. Exports reached 826 million units and were valued at $411 million in 2004.
Additional information on this report can be obtained on the web at http://www.researchandmarkets.com/reports/306193
According to the China Industrial Association of Power Sources, mainland China is acknowledged as the leading producer to primary batteries with an annual output of 19 billion units. There are 2,000 manufacturers with 300 of those manufacturers exporting to other countries.
Alkalines were the top batteries to be exported, accounting for 52 percent of the total. Although China is currently not the leading producer of rechargeable batteries, they are working to increase their manufacturing to surpass Japan and Korea. This past year, 2002, their exports of Nickel-cadmium and Nickel-metal hydride batteries totaled US$1.2 billion.
(Information is from “Batteries: Supplier Capability in China,” by Global Sources, Ltd., October 2003. See Web Site: http://www.globalsources.com)
The above figures are based on projections by the Korean Ministry of Commerce, Industry and Energy.
Korea’s goals are to catch up with Japan in the next few years, and the country has a vision to take the global market lead by 2010. Currently, Japan controls about 70 percent of the world’s production of the rechargeable compact batteries for IT mobile communication units.
Last year (2002), Korea’s share of the global market was 15.8 percent. Korea’s proportion of world production is forecast to reach 20 percent this year and 30 percent by 2005. (Information is based on figures from the Korea Ministry and the Battery R&D Association of Korea.)
The “Big Three” manufacturers, Samsung SDI, LG Chem and SKC are making sizeable investments to produce more rechargeables.
Already Samsung SDI is the third largest global manufacturer, following Sony and Sanyo of Japan. Samsung plans to raise production capacity to 18 million per month by the close of 2003 and to 25 million cells by 2005. Currently, Sanyo reports that their output is 36 million cells per month.
SKC recently announced that is will sell Lithium-ion polymer batteries to the U.S. Department of Defense, having earned quality certification in June. SKI is also receiving US$1.1 million for development of the next-generation high-polymer batteries from the U.S. Defense department.
LG Chem is projecting to increase its investment in rechargeable and has a goal of producing 18-million-cells permonth by the end of October.
(Data in chart is from the Korean government’s report on the designated next-generation industries that are to propel Korea’s growth in the next decade. Such data was noted in “Rechargeable batteries to boost Korea’s growth” by Kim Mi-hui, Korean Herald, 10/23/03
Sprint PCS Rolls Out 3G. Should Investors Care?
While the industry hopes that the Sprint introduction of 3G, behind Verizon and AT&T will be a shot in the arm for cellular, analysts from Lehman Brothers don’t see the business generating free cash flow because of its $16 billion debt. Pricing of the service works out to about $1.50 per megabyte. (Ed note: Using Sprint 3G would make one hi-res download of BD’s next issue cost about $10.00.) Contrarily, USB Warburg thinks the $4/share Sprint can have growth to $17/share. (09-02BD78-15)
Barron’s Technology Week
August 9, 2002, p.1
Markets for Electronic Devices
Forecasts Fog(12-01 BD69-3-6)