The global lithium-ion (Li-ion) battery industry is at an inflection point, say McKinsey Partners Andreas Breiter, Denny Thiemig, Patrick Schaufuss, Raphael Rettig, Wenting Gao, and Yunjing Kinzel. McKinsey analysis projects the global battery market will grow to 4.2 terawatt-hours (TWh) in 2030 and 6.8 TWh by 2035. More than 85 percent of this demand is due to Li-ion batteries, fueled largely by interest in battery electric vehicles and energy storage. At the same time, Asia’s dominance, particularly in upstream and midstream supply chains, has created imbalances throughout the global battery value chain. Although governments are investing heavily to localize battery production, companies must go beyond regulatory compliance to build globally competitive industries outside Asia.
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A series of small treemaps displays the projected global battery demand and market split for 2025, and 2035, segmented by end use, geography, technology, and chemistry for 2035. The first set shows demand by segment in gigawatt hours (GWh): in 2025, total demand is around 2,000 GWh, with mobility making up 84 percent, BESS (battery energy storage systems) at 12 percent, and consumer electronics at 2 percent. By 2035, demand reaches approximately 6,800 GWh, with mobility holding steady at 85 percent, BESS at 12 percent, and consumer electronics at 2 percent. The next column breaks down 2035 demand by geography: China accounts for the largest share at 49 percent, followed by the EU at 19 percent, North America at 14 percent, and the rest of the world at 18 percent. The third column splits 2035 demand by technology: lithium-ion dominates at 85 percent, with sodium ion at 8 percent, lead acid at 6 percent, and all other technologies collectively less than 1 percent. The final column depicts the split by battery chemistry for 2035 lithium-ion cells: 59 percent is Li-ion NMC and NCA (nickel manganese cobalt and nickel cobalt aluminum), 38 percent is Li-ion LFP (lithium iron phosphate), and 3 percent is other chemistries, with global Li-ion capacity estimated at roughly 6,300 GWh.
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Source: McKinsey Battery Insights; McKinsey Center for Future Mobility
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