Battery Management System Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)
The battery management system market is expected to register a CAGR of 4.85% during the forecast period, reaching the value of USD 10.8 billion in 2027 from USD 7.94 billion in 2020. The outbreak of the COVID-19 pandemic led to the global economic slowdown, which, in turn, led to a slowdown in industrial and commercial activities, hampering the growth of the battery management system market. Factors such as the increasing adoption of electric vehicles, the need for robust charging infrastructure, and the focus on increasing the energy efficiency of batteries are expected to drive the demand for battery management systems during the forecast period. However, the technological limitation on off-the-shelf battery management systems or standard battery management systems is one of the major restraints for the market. Key Highlights
Key Market TrendsTransportation Segment Expected to Dominate the Market
- The transportation sector has dominated the market in the past and is expected to be the largest segment during the forecast period owing to the increasing adoption of electric vehicles.
- The technological advancements in the battery management systems with advantages, such as reduced complexity, better efficiency, and improved reliability, among others, are expected to provide growth opportunities in the future.
- Asia-Pacific is expected to dominate the battery management system market due to the increased sales of electric vehicles in countries like China and Japan. This rise has been due to the extensive efforts of the governments to reduce greenhouse gas emissions.
Asia-Pacific is Expected to Dominate the Market
- Vehicles with internal combustion engines (ICE) were the only types used earlier. However, nowadays, technology has been shifting toward electric vehicles (EV), due to growing concerns for the environment. Therefore, due to these reasons, battery management systems do not have any market in the ICE sector.
- Lithium-ion batteries are mostly used in EVs as they provide high energy density, low self-discharge, less weight, and low maintenance. For ICE vehicles, the lead-based battery is being widely used and is expected to continue to be the only viable mass-market battery system for the foreseeable future. For use in SLI applications, lithium-ion batteries still require higher cost reductions for them to be considered a viable mass-market alternative to lead-based batteries.
- Lithium-ion battery systems propel the plug-in hybrid and electric vehicles. Owing to their high energy density, fast recharge capability, and high discharge power, lithium-ion batteries are the only available technology capable of meeting OEM requirements for the vehicle driving range and charging time. The lead-based traction batteries are not competitive for use in full hybrid electric vehicles or electric vehicles because of their lower specific energy and higher weight.
- The global production of batteries for electric vehicles is mainly concentrated in the Asia-Pacific region, with Chinese, Japanese, and South Korean companies dominating the sector and building factories in Europe to conserve their supremacy. China’s significant market share in the midstream and downstream value chain of Li-ion batteries makes it the largest producer of Li-ion batteries across the world. The country is also making efforts to reduce air pollution levels, which is expected to register a high growth rate in the sales of electric vehicles and lead to high demand for EV batteries.
- Additionally, China is the global hotspot for electric vehicle battery manufacturing. There are 93 Giga factories in China, and the country is projected to have around 130 by 2030; the country is expected to dominate the market during the forecast period. This, in turn, is expected to create tremendous demand scope for battery management systems in the country.
- Furthermore, the Indian government has taken several initiatives to promote electric vehicles in the country. For instance, in April 2019, phase II of the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME) India scheme was implemented for a period of three years. The main objective of the scheme is to promote faster adoption of electric and hybrid vehicles by providing upfront incentives for the purchase of electric vehicles and by creating the necessary charging infrastructure for electric vehicles.
- In recent years, the electric battery manufacturing market was dominated by the Asia-Pacific region and is expected to continue to do so during the forecast period too. Europe is expected to witness significant growth during the forecast period owing to factors like increasing investment in the sector due to favorable government policies and various incentives for electric vehicle battery manufacturing players.
- For instance, in January 2021, the European Commission approved a second Important Project of Common European Interest to support innovation and research in the battery value chain. The project is called “European Battery Innovation” and was jointly prepared and notified by Belgium, Croatia, Austria, Finland, Germany, France, Greece, Poland, Italy, Slovakia, Sweden, and Spain. In the coming years, the twelve countries are expected to provide up to EUR 2.9 billion in funding, which is expected to unlock around EUR 9 billion in private investments.
- Hence, based on the above-mentioned factors, the transportation segment is likely to dominate the battery management systems market during the forecast period.
- Asia-Pacific is likely to be a major market for battery management systems during the forecast period. In Asia-Pacific, China is expected to witness strong growth due to the rapid growth in the EV market.
- The rising demand for consumer electronics is likely to add to the demand for BMS, owing to the increasing integration of BMS in consumer electronics for safety purposes.
- China is the largest market for electric vehicles (EV), with over 3.33 million EVs sold by 2021, and it is expected to remain the world’s largest electric car market. China accounted for almost 40% of the global electric car sales in 2021.
- Earlier, the foreign automakers faced a 25% import tariff, or they were required to build a factory in China with a cap of 50% ownership. In January 2022, the 50% ownership rule was relaxed for passenger cars, added to which the rules restricting a foreign company from establishing more than two joint ventures producing similar vehicles in the country were also removed.
- The Government of China is likely to cut subsidies on electric vehicles by 30% in 2022 and completely eliminate it by the end of the year, as the electric vehicle industry in the country is now successful. The planned subsidy cut is aimed at reducing the reliance of the manufacturers on government funds for the development of new technologies and vehicles.
- Further, according to the Indian Brand Equity Foundation (IBEF), the Indian appliance and consumer durables market is expected to increase to a CAGR of 9%, amounting to INR 3.15 trillion in 2022. Furthermore, The Indian government anticipates that the Indian electronics manufacturing sector is likely to reach USD 300 billion by 2024–25. Thus, the increasing demand for consumer electronics is likely to increase the demand for battery management systems in India during the forecast period.
- The automotive industry is one of the major end-users for battery management systems in India. In the automobile industry, BMS is used for critical applications such as temperature, voltage, current monitoring, battery state of charge (SoC), and cell-balancing for lithium-ion batteries. In addition, the rising adoption of electric vehicles in India is driving the market for the automotive battery management system to provide safety, performance optimization, health monitoring and diagnostic of battery, and communication with other electronic control units (ECU).
- In June 2022, EV startup Mecwin India announced that it is likely to invest approximately USD 6.38 million to set up an EV motor, controller, and BMS systems manufacturing plant in Karnataka, India. The factory is likely to have an initial manufacturing capacity of 2,000 units per day and is likely to cater to the demand for EV Original Equipment Manufacturers (OEMs). Thus, such upcoming projects are likely to increase the demand for BMS systems in India during the forecast period.
- Therefore, the above-stated factors can be considered as the major driving factors for battery management systems in the region, where the market is expected to grow during the forecast period.
The battery management system market is moderately fragmented. The key players in the market include Eberspaecher Vecture Inc., Elithion Inc., BMS Powersafe, Texas Instruments Incorporated, and Sensata Technologies Inc., among others.Additional Benefits:
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
1 INTRODUCTION1.1 Scope of the Study1.2 Market Definition1.3 Study Assumptions2 EXECUTIVE SUMMARY3 RESEARCH METHODOLOGY4 MARKET OVERVIEW4.1 Introduction4.2 Market Size and Demand Forecast in USD billion, till 20274.3 Recent Trends and Developments4.4 Government Policies and Regulations4.5 Market Dynamics4.5.1 Drivers4.5.2 Restraints4.6 Supply Chain Analysis4.7 Porter's Five Forces Analysis4.7.1 Bargaining Power of Suppliers4.7.2 Bargaining Power of Consumers4.7.3 Threat of New Entrants4.7.4 Threat of Substitute Products and Services4.7.5 Intensity of Competitive Rivalry5 MARKET SEGMENTATION5.1 Application5.1.1 Stationary5.1.2 Portable5.1.3 Transportation5.2 Geography5.2.1 North America5.2.2 Europe5.2.3 Asia-Pacific5.2.4 South America5.2.5 Middle-East and Africa6 COMPETITIVE LANDSCAPE6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements6.2 Strategies Adopted by Leading Players6.3 Company Profiles6.3.1 Eberspaecher Vecture Inc.6.3.2 Elithion Inc.6.3.3 Leclanche SA6.3.4 Renesas Electronics Corporation6.3.5 LION Smart GmbH6.3.6 Sensata Technologies Inc.6.3.7 RCRS Innovations Pvt. Ltd6.3.8 Nuvation Energy6.3.9 Texas Instruments Incorporated6.3.10 BMS Powersafe7 MARKET OPPORTUNITIES AND FUTURE TRENDS