Where will lithium-ion battery prices be in 2025

The study susts that lithium-ion battery prices are expected to stabilize after falling to historic lows in 2024 on the back of declining lithium battery material costs and expanding sales.

The rapid downward trend in lithium-ion battery prices in the previous years is likely to slow down in 2025 due to rising battery material costs. Declining manufacturing costs, driven by economies of scale and efficiency improvements, have led to a flattening of the price curve for lithium-ion batteries.

Research firm TrendForce, Inc. claims that the continued decline in battery prices for electric vehicles (EVs) and energy storage systems (ESS), but showed signs of moderation in the fourth quarter of 2024.

Overall, lithium-ion battery prices fell more sharply in 2024 compared to the decline in battery material prices, suggesting that margins for battery manufacturers are being squeezed. As a result, battery suppliers may push prices higher to mitigate losses as global demand for electric vehicles and energy storage systems is set to grow through 2025.

According to TrendForce, “This is expected to support price stabilization of key battery materials, such as lithium iron phosphate, battery copper foil, and electrolyte, resulting in a stabilization of the average promotional battery price in the first quarter of 2025.”

Looking ahead to 2025, thanks to policies such as vehicle replacement subsidies, China’s electric vehicle market is expected to grow, with sales expected to increase by about 30% year-on-year.TrendForce noted that this optimistic demand outlook will help stabilize battery material costs, with power battery prices expected to be close to the level of December last year in January this year.

Meanwhile, the first quarter of 2025 will be a slow season for energy storage deployments, and many battery makers are likely to cut back on production, TrendForce said, adding that given the relatively stable cost of battery materials, prices for batteries used in energy storage systems are expected to remain stable in January this year.

Analysts emphasized that most battery material price declines have basically stabilized, with limited room for further declines. Continuing price declines in materials such as lithium iron phosphate, battery copper foil, and electrolyte have taken their toll on suppliers, with a slight price rebound occurring in December 2024.TrendForce Inc. points out that rising raw material costs will force companies to make greater efforts to control overall production costs in the near future.

In a highly competitive market, battery manufacturers have shifted their focus to technological advancements and production process upgrades. Some manufacturers have already launched ultra-large-capacity energy storage batteries of more than 500Ah, and these battery products are expected to gradually enter the market in 2025