From USD 44.2 billion in 2020 to USD 94.4 billion in 2025, the worldwide lithium-ion (Li-ion) battery market is predicted to increase at a CAGR of 16.4%. Increased demand for electric vehicles, lithium-ion batteries for industrial applications, linked and IoT-based devices, and automation and battery-operated material-handling equipment in industries are all pushing the li-ion battery market forward.

For more than two decades, lithium-ion batteries have been in use. The great energy density of Li-ion cells makes them more adaptable and cost-effective than any other battery technology, from tiny smartphones to huge capacity batteries that power electric autos. However, the advantage does not imply that they are risk-free.

In this article, we are going to explore the challenges in lithium-ion battery manufacturing and desiging in real-time and what could be the possible solution for the same.

Lithium-ion battery design challenges

The entire lithium battery segment is divided into 2 parts, one is high voltage and the other is low voltage.

Lack of standard Protocols

In the case of high voltage batteries, there are standard protocols as the high-speed EV manufacturers who use these high voltage batteries have to get proper certification from the govt.

But in the case of low voltage batteries which are used by low-speed EVs, there aren’t mandatory certifications. So the standard protocols are not followed.

Standard protocols include the type of connectors, wires to be used, and also battery testing standards.

CKD Models

The entire EV market of India is based on the CKD model in which the entire EV is imported by the OEM into segments and assembled in India. OEM does it to reduce the import duty.

Secondly, to showcase that they have various options available for the customers, they import EVs with different design options on the same voltage platform. This means even though the voltage is the same every other EV will require a different battery design because the chassis design will be different.

Sheet Metal Challenges in Battery Designing

The thickness and strength of the sheet metal are very important. A slight change in the thickness of the sheet metal can cause a lot of problems.

If the thickness is increased, then the overall load of the EV will increase. That will further increase the rate of discharge of the battery.

If the thickness is less, then, in the long run, the chances of the battery box getting destroyed cannot be neglected. The weight of the cells will impact the battery box if its thickness is less than what is required.

Lack of Skilled Engineers

As of now Lithium Battery Manufacturing in India is very new. So we don’t have engineers with even the basic skills required to design lithium batteries. It’s mostly because of the gap between education and industry.

Lithium batteries manufacturing challenges

It’s not the design of lithium batteries where there are challenges, there are a lot of challenges in the manufacturing segment as well. Let’s analyze them one by one:

Supply chain challenges

The supply chain challenges include the following

  1. Importing Lithium Cells: India does not have a lithium cell manufacturing capacity. The battery pack manufacturing companies import the cells from China or other parts of the world. It won’t be wrong to say that the entire base of the Indian EV Sector is dependent on Import.
  2. Importing BMS: BMS is a very important part of the lithium battery. But sadly because of the global shortage of semiconductors, there is a demand and supply gap that is affecting the production of BMS. Again, more than 90% of the BMS is imported.

This confirms that as of now the Indian Lithium Battery Market is mostly dependent on import.

Logistics Issues

Logistics plays a very important role in the supply chain process.

The COVID-19 pandemic has made supply chain concerns even worse. The economic situation has gotten more difficult, and sustainability is becoming more important. The subject of supply chain management has never been more prevalent. What are the problems that supply chains will encounter in the coming year? So, what can we anticipate?

The logistic challenges can be understood by below given 3 points.

First, and perhaps most evident to many of us, was the COVID pandemic’s unprecedented strains on global supply networks, as well as the accompanying sequence of lockdowns and restrictions that varied in timing and intensity from nation to country.

Second, the Suez Canal blockade last year impacted 12% of world commerce since the canal transports nearly one million barrels of oil and 8% of liquefied natural gas every day.

Third, the impact of logistics and supply chain operations on the environment is becoming more recognized. Governments must establish more sustainable supply chain practices if they are to reach their emissions objectives and pledges. The COP26 meeting in Glasgow in November placed a major emphasis on transportation, especially freight and logistics. If a sustainable future is to be realized, business as usual is no longer an option.

Because of all of these things, the freight rates have risen which is further affecting the price of elements used to manufacture the lithium cells.

What steps Govt. of India is taking to counter lithium-ion battery manufacturing and designing challenges?

  • India has introduced the PLI scheme to set up a domestic lithium-ion cell manufacturing industry.
  • India has introduced a Rs. 76000 crore PLI scheme to set up the domestic semiconductor manufacturing industry.
  • India is working towards setting up an industry for manufacturing EVs within the country.

All these things will for sure lower our dependency on Import.

Now regarding the skilled engineers and workforce, the industry experts need to develop some standards and protocols, and share the same with the education department of the govt. so that new education policies can be developed. This can help to fulfill the skill gap in the industry.

At Inverted Energy, we manufacture lithium batteries for the Energy Storage.