Battery makers must look beyond EVs for profitability

Lithium-ion battery market may be overbuilding with expected capacities exceeding demand

- Ayaan Kartik

The case for building huge factories—or gigafactories—to manufacture lithium-ion batteries for electric vehicles (EVs) in India has a curious twist.

The country may be adding capacity way beyond what its EV market—spanning cars, two-wheelers and three-wheelers—will need in the near future, raising questions over whether battery makers can turn a profit.

Both industry players and experts say the way out is for battery manufacturers to look beyond EVs for sales—in industries such as drones, telecom towers, power tools, data centres, and stationary storage for C&l (commercial and industrial), among others.

According to data from company presentations and announcements, Ola Electric, Amara Raja, Reliance Industries, Tata’s Agratas, Exide Industries and JSW Group are cumulatively putting in capacity that may add up to 100GWh by the end of this decade.

Mint’s queries to these companies remained unanswered till press time.