Worldwide capacity of Li-ion batteries for Electric vehicles applications is expected to soar ten times from 4,400 megawatt-hours (MWh) in 2013 to nearly 49,000 MWh by 2020, according to a new report by Navigant Research.
According to the report, the improvement in lithium ion (Li-ion) battery technology is helping adoption of the technology and boosting the electric vehicles market.
With the improvement in Li-ion technology, EV manufactures have shifted to Li-ion batteries from nickel-metal hydride (NiMH) batteries, the report added.
Navigant Research senior analyst David Alexander said Li-ion technology continues to improve, as increased energy densities translate into smaller and lighter battery packs with more power.
"At the same time, leading battery cell manufacturers have built new factories utilizing the latest production techniques, including greater automation and faster throughput," Alexander said.
"This will lead to a reduction in the cost per kilowatt-hour (kWh) over the next few years, provided that volumes continue to increase."
According to the analysts, the Li-ion batteries market will be driven by the growth of battery electric vehicles (BEVs), as they use much larger battery packs than plug-in hybrid electric vehicles (PHEVs).
PHEVs use battery packs ranging from 4 kWh to 16 kWh while current model of BEVs use battery packs ranging from 16 kWh to 85 kWh.
The analysts believe that hybrid vehicles using Li-ion technology is expected to grow steadily as automakers update their models.