Volkswagen to Lead Electric Cars in 2030... Batteries Dominated by LG Chem and CATL

Battery Market Led by Five Companies: LG Chem, Panasonic, CATL, Samsung SDI, and BYD

[Asia Economy Reporter Hwang Yoon-joo] Although the global electric vehicle (EV) and battery markets experienced some stagnation this year due to the novel coronavirus disease (COVID-19), it is forecasted that the market will recover and grow rapidly starting next year. In particular, by 2030, the leadership in electric vehicles is expected to shift from Tesla to the Volkswagen Group, and the EV battery market will be led by five companies from Korea, China, and Japan: LG Chem, Samsung SDI, Panasonic, CATL, and others.

On the morning of the 14th, at the 'Next Generation Secondary Battery Seminar 2020 (NGBS 2020)' held at COEX in Samseong-dong, Seoul, SNE Research projected that by 2030, Volkswagen Group's electric vehicle sales (including battery electric vehicles, plug-in hybrid electric vehicles, and hybrid electric vehicles) will reach 6.39 million units, making it the world's number one EV manufacturer. Following Volkswagen, Toyota (5.47 million units), Renault-Nissan (4.5 million units), Tesla (3.37 million units), Hyundai-Kia (2.36 million units), and GM (2 million units) are expected in that order.

For this year, Toyota is expected to be the top EV seller with 1.17 million units. Renault-Nissan is projected to sell 380,000 units, Tesla 300,000 units, and both Volkswagen and Hyundai-Kia are expected to sell 280,000 units each.

Oh Ik-hwan, Senior Researcher (Vice President) at SNE Research, explained, "Although Tesla currently leads the EV market, Volkswagen ranks first in global automobile sales. Because Volkswagen has a large market share through its internal combustion engine sales network, if it actively expands EV sales this year, it is expected to catch up with Tesla in 2 to 3 years and surpass Tesla starting from 2030."

Accordingly, the EV battery market is also expected to grow rapidly. In particular, it is analyzed that EV battery demand will exceed supply starting in 2022.

This year, EV battery demand is 53 gigawatt-hours (GWh), while the global battery suppliers' supply capacity is 142 GWh, resulting in surplus supply. However, by 2022, battery demand is expected to rise sharply to 272 GWh, nearly matching supply capacity (273 GWh), and by 2025, battery demand (761 GWh) is projected to exceed supply (458 GWh) by 40%.

Despite SK Innovation recording a large deficit in the first quarter of this year, investments such as EV battery capacity expansion are proceeding as planned. Similarly, China's CATL secured expansion funds through a 3 trillion won capital increase earlier this year.

Currently, the EV battery market is dominated by three companies holding 70% of the global market share: Korea's LG Chem (27%), Japan's Panasonic (26%), and China's CATL (17%). As competition among these three intensifies, Korea's Samsung SDI and China's AESC are expected to compete in the mid-tier, while China's BYD and Korea's SK Innovation are anticipated to grow and catch up.

LG Chem recorded the number one global EV battery market share for the first time in the first quarter of this year with 5.5 GWh. Some analysts predict that if Tesla's EV sales increase in the second quarter, Panasonic (5.2 GWh) might reclaim the top spot. However, SNE Research believes LG Chem will maintain its leading position due to its relatively diverse business portfolio compared to Panasonic and CATL.

Considering government subsidies, the resumption of automobile factories in China, and Tesla's sales volume in China, it is expected that the competition between China's CATL and Korea's LG Chem will continue fiercely in the long term.

This content was produced with the assistance of AI translation services.