K-Battery, Leading Competitiveness to Be Decided in the Next 2-3 Years... "Must Strengthen Technology and Infrastructure Development"

K-Battery Emerges as a Leading Export Product with Annual Sales of 5 Billion USD
Efforts Needed in Securing Core Material Technologies, Raw Materials, and Infrastructure Expansion

Global Electric Vehicle (EV) Annual Sales and Battery Demand Forecast

[Asia Economy Reporter Hwang Yoon-joo] It has been found that our electric vehicle battery industry needs to devote more effort over the next 2-3 years to technology, infrastructure, and building an innovative industrial ecosystem in order to firmly establish its position as a global leader.

According to the "Korea-China-Japan Battery Trilateral Competition and Our Challenges" report released on the 18th by the Korea International Trade Association's International Trade and Commerce Research Institute, the global electric vehicle battery (secondary battery) market size more than doubled from $15 billion in 2016 to $38.8 billion last year. Additionally, South Korea's exports of this item grew at an average annual rate of 12.8% from 2014 to 2019, reaching $4.683 billion in 2019. Although the first half of this year recorded $2.217 billion, a 4.0% decrease compared to the same period last year, an upward trend is expected in the second half, projecting the annual total to approach $5 billion.

Examining the global battery market shares of Korea, China, and Japan over the past five years (based on shipment volume of the top 10 global manufacturers), Korea rose from 9.5% in 2016 to 34.5% this year, taking first place. Meanwhile, China has turned to a declining trend this year with 32.9%, and Japan has continuously decreased since 2018 to 26.4% this year.

The report cited the intensifying competition in the battery market due to ▲battery price declines ▲global alliances and mergers ▲entry of automakers into the battery market (vertical integration), and predicted fierce competition among Korea, China, and Japan, which account for 93.8% of global production.

The report warned, "The next 2-3 years will be a critical turning point determining the future competitiveness of the battery industry, and in the mid-to-long term, it is highly likely that fewer than five competitive companies will monopolize or oligopolize the market." It cautioned that failure to secure core competitiveness could lead to a decline in market share.

Moreover, since Korea, China, and Japan are neck-and-neck in fundamental material technologies, securing patents for next-generation technologies such as all-solid-state batteries is considered paramount. The report also cited the example of China surpassing Korea in patent numbers in the LCD field and subsequently taking the number one market share, emphasizing the need for increased government attention to patenting and commercialization of material technologies.

Other important tasks identified by the report include stable procurement of raw materials such as lithium and nickel, expansion of infrastructure like electric vehicle charging stations, responding to the transition of upstream and downstream industries to the electric vehicle era, and building an ecosystem that leads innovation.

Son Chang-woo, senior researcher at the Korea International Trade Association, said, "Although the status of our battery industry has recently risen, many challenges remain to be solved," adding, "To respond to the rapid market restructuring expected within the next 2-3 years, not only corporate efforts but also the urgent establishment of a concentrated cooperation system among industry, government, and academia is necessary."

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