Swappable Electric Vehicle Battery Market 2030: What Will Be Changes In Investment Ratio With Opportunity Analysis??

Posted by Mrudula Anil Karmarkar on September 5th, 2023

The global swappable electric vehicle battery market size is expected to reach USD 2.36 billion by 2030, expanding at a CAGR of 22.8% from 2023 to 2030, according to a new study conducted by Grand View Research, Inc. The rising adoption of electric vehicles with swappable batteries by consumers, as they are not required to pay the high upfront cost of fixed batteries is propelling the market growth. This trend is fueled by various factors, including rising fuel expenses, government incentives, and lower carbon emissions.

To reduce carbon emissions and achieve net-zero targets, governments worldwide are implementing strategic initiatives. Many countries have committed to reaching net-zero emissions by mid-century or even earlier and are participating in international agreements to enhance their efforts. For instance, as per the Mission Zero plan released in 2023, the Netherlands government has set a target for all new buses utilized in public transportation to emit zero harmful exhaust gases by 2030. This implies that the buses must either be battery electric or hydrogen fuel cell electric to comply with the regulation. Hence, ongoing government initiatives to achieve net zero emission goals and the environmental benefits of rechargeable batteries are driving the adoption of swappable electric vehicle batteries, thereby propelling the market's growth.

Furthermore, various companies started producing swappable batteries for two- and three-wheel electric vehicles. For instance, GOGORO INC., a manufacturer of electric scooters, battery-swapping infrastructure, and smart mobility management systems, collaborated with ProLogium Technology, a prominent player in solid-state battery technology, to develop a solid-state lithium ceramic battery for two-wheeler battery swapping. The newly developed solid-state battery technology would be seamlessly integrated with the existing Gogoro swapping network and vehicles.

The declining cost of lithium-ion batteries is expected to drive demand for swappable batteries for electric vehicles. As per a study conducted by the Massachusetts Institute of Technology (MIT) and the Energy and Environmental Science Journal, the reduction in lithium-ion battery prices could result in a significant drop in the prices of swappable batteries, which would make them more economical and increase their demand. The study suggests that more than 50% of this cost reduction is attributed to research and development efforts, including funding from both private and government segments.

The outbreak of the COVID-19 pandemic severely impacted several economies. In addition, increased fuel prices owing to the Russia-Ukraine conflict are expected to prompt consumers to adopt electric vehicles considering the lower lifecycle cost of an electric vehicle as compared to internal combustion engine (ICE) vehicles, which is ultimately creating more demand for swappable electric vehicle batteries. Furthermore, aggressive investments in innovation and subsequent advances in battery technology are expected to create new opportunities for the growth of the swappable electric vehicle battery industry.

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The need to mitigate the increase in carbon emissions and other noxious gases caused by transportation has prompted the adoption of electric vehicles. In addition, increasing strategies by automakers to develop EVs with swappable batteries to reduce the upfront cost of the vehicles are expected to increase the demand for swappable electric vehicle batteries in the upcoming years. Moreover, increasing partnerships between electric automakers and swappable battery manufacturers are expected to further drive the market.

The growth of the market for swappable electric vehicle batteries can be attributed to the increasing demand for electric vehicles and the need for charging solutions that are both efficient and convenient. As the popularity of electric vehicles grows, the demand for more effective charging solutions becomes more evident. Concerns about carbon emissions are driving the demand for battery-swapping technologies and infrastructure, prompting companies to make swift advances in these areas to meet the needs of electric vehicle owners. In addition, several market players are contributing to reducing CO2 emissions by developing swappable batteries. Gogoro Inc. reported that since 2015, the company has facilitated around 400,000 battery swaps daily, and over the course of its operation, the total number of battery swaps has exceeded 370 million. These swaps have helped to reduce approximately 250,000 tons of CO2 emissions.

Swappable Electric Vehicle Battery Market Report Highlights

• Lithium-Ion segment is anticipated to emerge as the fastest-growing segment over the forecast period. Increasing adoption of lithium-ion swappable electric vehicle batteries owing to their benefits such as lightweight and space-saving design, high efficiency, and low cost, among others, is attributed to the growth of the segment
• The >5 kWh capacity segment accounted for the largest market share in 2022. Increasing adoption of large-capacity swappable electric vehicle batteries as it covers long distances on a single charge and provide reliable energy storage for renewable energy systems is boosting the growth of the segment
• Two-wheeler segment is anticipated to emerge as the fastest-growing segment over the forecast period. The increasing development of two-wheeled electric vehicles equipped with swappable batteries and the growing market for e-bikes/e-scooters in developing countries are expected to boost the segment growth
• Asia Pacific is expected to grow at the highest CAGR from 2023 to 2030 due to the vast presence of swappable battery start-ups, significant growth in electric vehicle sales in the region, and extensive deployment of battery swapping stations in countries such as China India, Taiwan, and Japan
• Key players operating in the market include Contemporary Amperex Technology Co.; Limited, NIO Inc.; GOGORO INC.; Silence Urban Ecomobility; Honda Motor Co., Ltd.; SUN Mobility Private Ltd.; ONiON Mobility; Swap Energi Indonesia; Bounce; and Okinawa Autotech Internationall Private Limited 

The demand for rechargeable and removable batteries in electric vehicles, including light electric vehicles (LEVs) is steadily increasing. According to the "Global Supply Chains of EV Batteries" report by the International Energy Agency (IEA), fixed EV batteries typically make up 30% to 40% of the cost of electric vehicles. Thus, to minimize the additional cost of fixed batteries, several EV makers are developing EVs equipped with swappable batteries, which can reduce the upfront cost of an electric vehicle considerably, which is ultimately driving the growth of the market. Furthermore, the increasing utilization of battery-swapping infrastructure can be attributed to the reduced upfront costs of buying an electric vehicle, decreased charging time, and favorable government subsidies.

Leading suppliers in the swappable battery market are utilizing the most advanced technologies to improve the durability and lifespan of batteries during usage. These suppliers are also implementing strategic measures and utilizing sophisticated techniques to achieve net-zero emissions targets and to increase the effectiveness of the batteries. These initiatives result in batteries that have longer lifespans, contribute less e-waste, and have a smaller environmental footprint associated with their manufacturing and usage.

List of Key Players in the Swappable Electric Vehicle Battery Market

• Contemporary Amperex Technology Co., Limited
• NIO Inc.
• GOGORO INC.
• Silence Urban Ecomobility
• Honda Motor Co., Ltd.
• SUN Mobility Private Ltd.
• ONiON Mobility
• Swap Energi Indonesia
• Bounce
• Okinawa Autotech Internationall Private Limited