Innovative next-gen lithium-ion technology will triumph in the future battery market

The future trend of batteries will meet the growing needs in areas such as electric vehicles (EVs), renewable power solutions and consumer electronics.

Arthur D. Little (ADL) today released a new study, "Future of batteries: Winner takes all?" Based on extensive market analysis, the report examines the current enormous level of activity in the sector, which has seen existing and new players invest over US$13.7bil (RM55.4bil) over the last two years.

It predicts future trends that will meet growing needs in areas such as electric vehicles (EVs), renewable power solutions and consumer electronics. It aims to help players across the ecosystem build effective strategies that unlock value and market position.

The report predicts the battery market will become a US$90bil-plus (RM364bil) sector by 2025, and that new innovations, such as solid-state electrolyte lithium-ion (Li-ion) batteries, will replace existing battery technologies over the long-term.

This is thanks to improved performance and innovation delivery combined with consumer pull and willingness to pay for better solutions. Despite the current investment frenzy from various players, including the automotive, technology, consumer goods, utilities and chemicals sectors, either entering the market or expanding their offerings, the report predicts that the risks of failure are high.

Companies that successfully build complex innovation ecosystems, working with a range of partners and backed by significant intellectual property, have the greatest chance of winning and maintaining market share.

Michael Kolk, Partner and Head of ADL's Global Chemicals Practice, explains: "Battery technology is undergoing the biggest disruption in its 150-plus-year history, driven by the need for better solutions in areas such as electric vehicles and renewable power. However, companies need to beware of the risks, as well as the huge potential of the market, if they are to emerge victorious in the future."

The report explains that innovation, in terms of both new technologies and process transformation, is vital to bring down costs. — AP