Boulder, Colorado – Driven by demand for plug-in hybrid and all-electric vehicles, which require much larger battery packs than conventional hybrids, the market for lithium-ion (Li-ion) batteries will reach US$8 billion worldwide by 2015, up from $878 million in 2010, according to a report by Pike Research.

In the near term, the Li-ion market, and the electric vehicle (EV) industry in general, will be largely fuelled by government subsidies, incentives and production goals, the company said. “2012 will be the make-or-break year for the electric vehicle market,” said senior analyst John Gartner. “As government support for the sector winds down, demand from consumers and businesses will need to pick up the slack, or the industry faces the risk of oversupply.”

Gartner said that prices for Li-ion batteries will be a key determinant in the ultimate market acceptance of EVs, since battery cost will represent much of the price premium for them. He forecasts that Li-ion prices will fall from 50 per cent from 2010 to 2015, from $940 per kilowatt hour, to $470.

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