Lithium ion (Li-ion) battery market is expected to grow from $1.6bn in 2012 to about $22bn by 2020, according to a report from Pike Research.
According to the report, big amounts have been put in to decrease the cost of electric vehicles by reducing cost of the battery pack with only small results achieved.
Pike Research senior research analyst David Alexander said: "Li-ion batteries can supply the much greater capacity needed for battery electric and plug-in hybrid vehicles, and 2012 saw the launch and announcement of new models from many manufacturers, all featuring Li-ion batteries."
Factors that contribute to the increase in market include the fuel economy standards, preference for electric powered vehicles, and advances in battery technology.
The cost of the battery pack is expected to reduce to about $447 per kilowatt-hour by 2020, according to the report, while the research to reduce the size of batteries has started.
