Rising Material Costs Drive Up EV Battery Prices: BloombergNEF

NEW DELHI, Dec 10 — As India accelerates its transition towards electric mobility, the cost of electric vehicle (EV) batteries has come under renewed scrutiny. According to a recent BloombergNEF report, rising raw material prices are directly impacting the affordability of EVs, posing a challenge for both manufacturers and consumers. Here are the key factors driving up EV battery prices in India and their implications for the market.

1. Escalating Raw Material Costs

One of the primary contributors to the surge in battery prices is the increasing cost of essential raw materials such as lithium, cobalt, and nickel. These metals are crucial components of lithium-ion batteries, which dominate the EV market.

“The global average price of lithium-ion battery packs has increased by over 7% in 2023, reaching $139 per kWh,” according to BloombergNEF.

For India, which imports a substantial portion of these materials, the impact is even more pronounced due to currency fluctuations and import duties.

2. Supply Chain Disruptions

Global supply chain disruptions, exacerbated by geopolitical tensions and pandemic-related shutdowns, have led to shortages and delays in the delivery of raw materials and battery components.

“Delays in shipments of battery cells and raw materials have increased lead times for Indian manufacturers by up to 30%,” notes an industry expert.

These disruptions have forced local manufacturers to pay higher prices to secure timely supplies, pushing up the overall cost of EV batteries.

3. High Dependence on Imports

India’s EV battery ecosystem is heavily reliant on imports, especially from China, which accounts for over 70% of India’s battery imports.

“India imported approximately $1.2 billion worth of lithium-ion batteries in FY2022-23,” as per Ministry of Commerce data.

This dependence exposes Indian manufacturers to global price volatility and supply risks, making it challenging to maintain stable battery prices for domestic EVs.

4. Limited Local Manufacturing Capacity

Despite government initiatives like the Production Linked Incentive (PLI) scheme, India’s domestic battery manufacturing capacity remains limited. The lack of large-scale, cost-efficient production facilities constrains the industry’s ability to control prices.

“India’s current installed battery manufacturing capacity meets less than 10% of domestic demand,” industry estimates suggest.

Scaling up local manufacturing is crucial to reducing costs and insulating the market from international price shocks.

5. Impact on EV Adoption and Affordability

The rise in battery prices is directly affecting the cost of electric vehicles, which are already seen as expensive compared to their petrol and diesel counterparts in India.

“Batteries account for 35–40% of the total EV cost in India,” making affordability a major concern for mass-market adoption.

Higher prices may slow down the government’s target of having 30% of vehicles electric by 2030, unless mitigated by subsidies, tax incentives, or breakthroughs in battery technology.

6. Industry Response and Policy Initiatives

To counter these challenges, both industry stakeholders and the government are exploring solutions such as battery recycling, research into alternative chemistries, and enhanced policy support.

“The government’s FAME II scheme and recent PLI announcements are expected to attract over ₹18,000 crore in investment for battery manufacturing,” according to official statements.

Such measures aim to strengthen the domestic supply chain, reduce import dependence, and stabilize prices in the long term.

The increase in EV battery prices, driven by rising material costs and supply chain challenges, poses a significant hurdle for India’s electric mobility ambitions. As the industry and policymakers work towards building a resilient domestic ecosystem, sustained efforts will be required to ensure that electric vehicles remain affordable and accessible to Indian consumers.

Certainly! Here’s an additional detailed numbered point expanding on the topic:

4. Impact on EV Infrastructure Rollout Timelines: The rising cost of EV batteries—driven by higher prices for key materials like lithium, nickel, and cobalt—does not just affect the sticker price of electric vehicles. According to BloombergNEF, these increased costs also have downstream effects on the pace and scope of EV infrastructure deployment. Higher battery prices can delay automakers’ plans for mass-market, affordable EVs, which in turn slows consumer adoption. As a result, infrastructure projects such as charging station installations and grid upgrades may face postponements or scaling back due to reduced short-term demand forecasts. This interconnected dynamic highlights how fluctuations in battery material costs can ripple through the entire EV ecosystem, potentially hindering the speed of transition to electric mobility.

Sources

Original Source

google.com - Read original

Official Sources

• Intergovernmental Panel on Climate Change (IPCC): IPCC opens registration of experts to review the first draft of the Methodology Report on Inventories for Short-lived Climate Forcers

Quotes

• Publishing Domain: google.com
• Published Date: 2025-12-10T15:43:30+05:30
• Original URL: Read original (news.google.com/rss/articles/CBMi7AFBVV95cUxPY0JhSS1EZGJrSTU2aGV3dnFHcmlwV… …)

Editorial Check

• Originality: 20 / 100 — The summary is almost identical to the title and does not provide additional insights or unique phrasing. It simply repeats the main headline from the source.
• Helpfulness: 10 / 100 — The summary offers minimal information beyond what is already present in the title. It does not explain how or why EV battery prices are affected by material costs, nor does it provide context or details for the reader.