Lithium Iron Phosphate Batteries Market Size

Lithium Iron Phosphate Batteries Market Overview

Lithium Iron Phosphate Batteries Market Size was valued at USD 17.7 Billion in 2023. The Lithium Iron Phosphate Batteries market industry is projected to grow from USD 20.15 Billion in 2024 to USD 60.07 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 14.63% during the forecast period (2024-2032). Rising demand for lithium iron phosphate batteries in electric and hybrid electric vehicles are the key market drivers enhancing the market growth.

Source Secondary Research, Primary Research, MRFR Database and Analyst Review

Lithium Iron Phosphate Batteries Market Trends

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  Stringent Government Policies to Curb Pollution and Promote Renewable Energy to boost market growth

  
  

Industries are turning to LFP batteries due to the implementation of strict government guidelines to regulate the increase in environmental pollution. The energy industry is working all over the world to produce renewable energy and store it for the future. Low cost, self-discharge rate, and minimal installation space are the main factors driving the adoption of his LFP batteries in grid and energy storage devices. These batteries are highly resistant to high temperatures, making them ideal for use in remote locations and thermal control applications.

Growing public awareness of the importance of environmental stewardship is driving the expansion of renewable energy projects such as photovoltaic systems, grid-connected photovoltaic backup systems, and nuclear power plants. Wind energy projects are propelling the expansion of LifePO4 batteries. Wind energy projects are driving the growth of LifePO4 batteries. Moreover, the increasing use of energy storage supports the expansion of LFP batteries.

Since the 1990s, the main factor that has slowed the adoption of lithium-ion batteries is their price. Lithium-ion batteries contain many components, and the key element of lithium iron phosphate batteries is the cell, which accounts for 50% of the cost. However, recent developments by lithium-ion manufacturers have contributed to falling battery prices, which will continue to fall. 

Reducing component costs and introducing advanced technologies to increase battery capacity are key factors driving the growth and adoption of lithium-ion batteries. However, rising demand for other batteries in consumer electronics, electric vehicles, and energy storage systems, such as lead-acid batteries, sodium-nickel chloride, flow batteries, and lithium-air batteries, is expected to stymie the growth of LFP batteries. Furthermore, the introduction of new energy devices, such as flywheel batteries, is limiting market growth.

Lithium Iron Phosphate Batteries Market Segment Insights

Lithium Iron Phosphate Batteries Power Capacity Insights

The Lithium Iron Phosphate Batteries market segmentation, based on power capacity, includes upto 16, 250 mAh, 16,251-50,000 mAh, 50,001-100, 000mAh, and 100,001-540,000 mAh). The 16,251-50,000 mAh power capacity Lithium Iron Phosphate Batteries segment held the majority share in 2021 in respect to the Lithium Iron Phosphate Batteries market revenue. This is primarily owing to the growing usage in several industries, including industrial, automotive, and electricity production.

April 2021 Renault AIR4 introduced a Renault 4-inspired flying car which is equipped with 22,000mAh lithium-polymer batteries.

Lithium Iron Phosphate Batteries Industry Insights

The Lithium Iron Phosphate Batteries market segmentation, based on industry, includes automotive, power, industrial, and others. The automotive industry segment dominated the market in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. 

This is due to the increasing preference for metal implants due to their high resistance to corrosion. Automotive sectors, non-traditional power storage technologies which can improve automobile effectiveness and performance are just a major topic of interest. 

Lithium iron phosphate reactors are anticipated to emerge as the most popular option for an alternative power storing battery pack due to their high energy content and lengthy throughput times. As a result, it is anticipated that increased global growth of the automotive, particularly in China, will drive up the price of lithium iron phosphate batteries. Hence, rising applications in automotive for Lithium Iron Phosphate Batteries positively impacts the market growth.

Lithium Iron Phosphate Batteries Voltage Insights

The Lithium Iron Phosphate Batteries market data has been bifurcated by voltage into Upto 3.2 KV, 3.2–12 KV, and 12–20 KV. The 12–20 KV voltage segment dominated the market in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. It is being used more frequently as storing energy for renewable power sources, clear obvious grid storage units, maritime, or other applications.

January 2023 Omega Seiki Mobility (OSM) announced a joint venture with iM3NY to bring battery cell technology to the Indian market. iM3NY Li-ion cells utilize a technology known as Bio mineralised Lithium Mixed Metal Phosphate (BM-LMP).This approval has further broadened the growth opportunity for the Lithium Iron Phosphate Batteries industry.

Figure 2 Lithium Iron Phosphate Batteries Market, by Voltage, 2024 & 2030 (USD Billion)

Source Secondary Research, Primary Research, MRFR Database and Analyst Review

Lithium Iron Phosphate Batteries Application Insights

Based on application, the Lithium Iron Phosphate Batteries industry has been segmented into portable, stationary, and others. Portable held the largest segment share in 2021, owing to the considerably greater organizational effectiveness. In 2021, the portable application sector held a majority (55%) of the international market. It is explained by the increased need on LiFePO4 batteries coming from the automobile industry, which represents the main source of demand.

Furthermore, as the requirement for storing renewable energy projects grows, the permanent service sector may face competition from the versatile application sector. Due to the necessity to switch toward renewable power sources, such as solar and wind power for environmentally friendly and safe electricity, the stationary usage market is anticipated to have significant expansion within the next few years. It is anticipated that large expenditures will be made across the public and industrial domains as a result of the switch to sustainable energy sources, which will increase the supply of this kind of device.

Lithium Iron Phosphate Batteries Regional Insights

By Region, the study provides the market insights into North America, Europe, Asia-Pacific and Rest of the World. Asia-Pacific Lithium Iron Phosphate Batteries market accounted for USD 4.56 billion in 2021 and is expected to exhibit a significant CAGR growth during the study period. This is attributed to the rising popularity of electric cars. It's conceivable that manufacturers in India, China, Australia, and Japan, will invest money in LFP cells. 

The Asia Pacific may offer opportunities for expansion for such energy makers with the increase in the need for computers, cellphones, as well as other electrical gadgets across the region. Moreover, China Lithium Iron Phosphate Batteries market held the largest market share, and the India Lithium Iron Phosphate Batteries market was the fastest growing market in the Asia-Pacific region

Further, the major countries studied in the market report are The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 3 Lithium Iron Phosphate Batteries Market Share By Region 2021 (%)

Source Secondary Research, Primary Research, MRFR Database and Analyst Review

Europe Lithium Iron Phosphate Batteries market accounts for the second-largest market share due to the availability of cutting-edge technology demand and government regulations to meet the zero emission goal before 2050, lithium-ion battery manufacturers increased their expenditures in Germany and the United Kingdom. Further, the Germany Lithium Iron Phosphate Batteries market held the largest market share, and the UK Lithium Iron Phosphate Batteries market was the fastest growing market in the European region

The North America Lithium Iron Phosphate Batteries Market is expected to grow at the fastest CAGR from 2022 to 2030. This is due to presence of leading manufacturers. Notably, bullish government policies, including incentives will bode well for regional growth. Increasing sales of EVs are likely to boost the production of LFP batteries.

Lithium Iron Phosphate Batteries Key Market Players & Competitive Insights

Major market players are spending a lot of money on R&D to increase their product lines, which will help the Lithium Iron Phosphate Batteries market grow even more. Market participants are also taking a range of strategic initiatives to grow their worldwide footprint, with key market developments such as new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations. Competitors in the Lithium Iron Phosphate Batteries industry must offer cost-effective items to expand and survive in an increasingly competitive and rising market environment.

One of the primary business strategies adopted by manufacturers in the Lithium Iron Phosphate Batteries industry to benefit clients and expand the market sector is to manufacture locally to reduce operating costs. In recent years, Lithium Iron Phosphate Batteries industry has provided with some of the most significant benefits. 

The Lithium Iron Phosphate Batteries market major player such as Lithium Werks (Netherlands), Shenzhen Bak Technology (China), Bharat Power Solution (India), Power Sonic Corporation (US), RELiON Batteries (US), BYD(China) and others are working to expand the market demand by investing in research and development activities.

In order to facilitate the switch from dirty fossil fuels to clean renewables like solar and wind power, Lithium Werks was founded in 2017. Lithium Werks specialises in offering robust, naturally secure, and dependable battery systems. A vertically integrated producer of cells and rechargeable and non-rechargeable battery packs, Lithion Power Group purchased the Valence module and BMS assets from Lithium Werks in 2020. 

Following the sale, Lithium Werks focussed on advancing its Lithium Iron Phosphate (LFP) cathode patent portfolio, cell production, custom OEM solutions, and Nanophosphate materials. It also increased R&D. In August 2022, Lithium Werks Inc. opened the largest Electrochemical Particle and Electrochemical Manufacturing Facility of Lithium-Ion batteries in the United States.

Also, BYD Co. Ltd. is a Chinese conglomerate manufacturing company headquartered in Shenzhen, Guangdong, China. The two largest subsidiaries of the business are BYD Automobile and BYD Electronic. Automobiles, buses, lorries, forklifts, electric bicycles, solar panels, and rechargeable batteries are all produced by BYD Company. 

It is a significant producer of vehicles (including hybrid and fully electric cars, buses, lorries, and other types of vehicles), battery-powered bicycles, forklifts, solar panels, and rechargeable batteries (mobile phone batteries, electric vehicle batteries and renewable bulk storage). In April 2022, BYD Corporation Limited intends to erect a new manufacturing site in Zhejiang, China. Also, in December 2021 Byd Corporation Limited announced intentions to expand the region of Jiangxi's batteries manufacturing capacity.

Key Companies in the Lithium Iron Phosphate Batteries market includes

• Lithium Werks (Netherlands)


• Shenzhen Bak Technology (China)


• Bharat Power Solution (India)


• Power Sonic Corporation (US)


• RELiON Batteries (US)


• Contemporary Amperex Technology (China)


• A123 Systems (US)


• Electric Vehicle Power System Technology Co. Ltd. (China)


• K2 Energy (US)


• Victron Energy (Netherlands)


• BYD (China)


• Greensun Solar Energy Tech Co. Limited (China)

Lithium Iron Phosphate Batteries Industry Developments

May 2022 Arun Plus Corporation Limited and Amperex Technologies Co., Ltd signed Memorandum of Understanding (MOU) in will investigate prospects for collaboration and growth in the rechargeable batteries industry in the Global markets

September 2021 LG Chem's LG Energy Solution is expected to expand its EV battery offering with LFP, which are gaining popularity due to their properties. LFP in Pouch Format will be used in the LG Energy Solution.

August 2021 CATL, a Chinese battery manufacturer, invested $15.60 million in the establishment of a new Shanghai-based automotive science and technology company. The CATL is a well-known LFP battery supplier to Tesla and Nio.

April 2021 The International Advanced Research Centre for Powder Metallurgy and New Materials developed a technology for the production of lithium iron phosphate cathode materials for lithium-ion batteries.

October 2020 Toyota and Panasonic announced a joint venture to build lithium-ion batteries for hybrid cars in Western Japan starting 2022. They believe it could help them meet the growing demand for electric vehicles.

German battery maker BMZ Group has created a new home storage system that can hold up to 26.7 kWh of energy per unit by 2024. The system, called Power4Home, runs on 16S1P lithium iron phosphate batteries that are devoid of cobalt. The new product is available from the manufacturer with two to eight battery modules. The usable energy of the basic two-module battery is 6.7 kWh, but the eight-module configuration provides 26.7 kWh.

The Ultra-Fast Charging, 6C LFP (Lithium Iron Phosphate) cell was introduced by DESTEN in 2023. In under six minutes, DESTEN's newest pouch form-factor cell can charge from 20% to 80% SOC. This cell has an outstanding chemical and thermal stability profile because of its LFP-based chemistry.

In 2024, SiAT, a top producer of cutting-edge nanomaterials for batteries in Taiwan, is happy to declare a strategic alliance with CPDC, a petrochemical firm in Taiwan. With this partnership, we are launching our second-generation lithium manganese iron phosphate (LMFP) paste, a ground-breaking product that will drastically improve battery safety standards in the whole market. 

The new LMFP paste contains a special combination that comprises the organophosphorus substance phosphozene, which is well-known for its remarkable capacity to lessen the energy produced prior to thermal runaway and to attenuate cell flammability.

Lithium Iron Phosphate Batteries Market Segmentation

Clean Energy Solutions Power Capacity Outlook

• Up to 16250 mAh


• 16251–50000 mAh


• 50001–100000 mAh


• 100001–540000 mAh

Lithium Iron Phosphate Batteries Industry Outlook

• Automotive


• Power


• Industrial


• Others

Lithium Iron Phosphate Batteries Voltage Outlook

• Up to 3.2 KV


• 3.2–12 KV


• 12–20 KV


• Above 20 KV

Lithium Iron Phosphate Batteries Application Outlook

• Portable


• Stationary


• Others

Lithium Iron Phosphate Batteries Regional Outlook

• North America
  
  
  
  • US
  
  
  • Canada
  
  
  
  


• Europe
  
  
  
  • Germany
  
  
  • France
  
  
  • UK
  
  
  • Italy
  
  
  • Spain
  
  
  • Rest of Europe
  
  
  
  


• Asia-Pacific
  
  
  
  • China
  
  
  • Japan
  
  
  • India
  
  
  • Australia
  
  
  • South Korea
  
  
  • Australia
  
  
  • Rest of Asia-Pacific
  
  
  
  


• Rest of the World
  
  
  
  • Middle East
  
  
  • Africa
  
  
  • Latin America