China is winning the battery manufacturing raceThe growing demand for lithium-ion batteries is being met with an increase in production capacities. Just between 2015 and 2020, the number of battery factories under construction or planning increased from four to 181. Lithium-ion battery production capacity worldwide is thus projected to significantly increase, growing from almost 300 gigawatt-hours in 2018 to over two terawatt-hours in 2028. However, this growing manufacturing capacity is not equally distributed around the world. In 2020, China was the powerhouse of lithium-ion battery manufacturing, producing around 77 percent of batteries that entered the global market. Not surprisingly, most of the largest battery factories in the world were located in China.
Although Europe is planning extensive investments in lithium-ion battery manufacturing facilities, China will still dominate the global production of lithium-ion batteries in the foreseeable future. It is expected that by 2025, China will be manufacturing some 65 percent of the world’s lithium-ion batteries, while European production is estimated to account for around 25 percent.