TrendForce’s latest investigations reveal that the prolonged decline in the prices of Chinese EV and ESS batteries during 2024 showed signs of easing in the fourth quarter. Suppliers are expected to push for price increases to mitigate losses as global demand for EVs and energy storage is expected to grow in 2025. This is anticipated to support the prices of key battery materials—such as LFP, li-ion battery copper foil, and electrolytes—thereby stabilizing average battery cell prices in the first quarter of 2025
TrendForce reports that, despite an overall decline in EV battery prices throughout 2024, demand during the traditional peak season in the second half of the year helped slow the downward trend significantly in Q4. Looking ahead to 2025, the Chinese EV market is expected to benefit from government policies such as vehicle trade-in incentives, driving an estimated 30% YoY increase in sales. This optimistic demand outlook is projected to stabilize battery material costs, with January prices for EV batteries expected to remain close to December levels.
In the energy storage market, strong growth in regions such as China, the US, and Europe during 2024 has been complemented by rising demand in emerging markets, including the Middle East and Southeast Asia. However, challenges like excess production capacity and declining raw material costs have led to a continued significant drop in LFP ESS battery prices. Fortunately, this downward trend has begun to slow.
Entering the traditional off-season for energy storage in 1Q25, many battery makers are likely to reduce production. Combined with relatively stable material costs, ESS battery prices in January are forecast to remain steady.
Manufacturers have shifted their focus amid intense competition in the ESS battery market to advancing technology and enhancing production processes. Some companies have already introduced ultra-large-capacity storage batteries exceeding 500Ah to raise industry entry barriers. These high-capacity cells are expected to gradually enter the market in 2025.
TrendForce highlights that the decline in prices for most battery materials has largely plateaued, with limited room for further reduction. Materials such as LFP, li-ion battery copper foil, and electrolytes, which have caused sustained losses for suppliers, saw slight price rebounds in December 2024. As terminal automakers continue to face fierce price wars, battery makers will encounter increased pressure from rising raw material costs, necessitating greater efforts to control overall production expenses.
