The market for power tool batteries is expected to grow at a CAGR of more than 7.67% during the forecast period. Major factors driving the market studied are the rising construction and infrastructure development activities, rapidly growing automotive industry in Asia-Pacific, and rising adoption of power tools. However, high cost associated with cordless power tool equipment is likely to restrain the growth of the market studied.
- Lithium-ion batteries for power tool dominated the market and is expected to be the leading segment during the forecast period. Even when the scope of utilization of lithium battery has not been tested much but the advantages of it being lightweight cumulated with high energy density provides the path for the growth of the segment during the forecast period.
- The increasing penetration of Lithium-ion battery and decreasing cost provides the opportunity for the growth of the market.
- North America dominated the market for power tool batteries during 2018 with increasing demand from the US.
Key Market Trends
Increasing Demand for the Lithium-ion Batteries
- Li-Ion is the latest type of battery used for power tools, which propels the scope of technological development for these batteries. Li-Ion batteries are lightweight with high energy density. Declining lithium-ion battery prices, environment-friendly characteristics, and rapidly growing end users, like the construction sector and industrial sector are expected to drive the market.
- However, Li-Ion batteries are more expensive to buy than the alternatives, among other reasons, as they have to be equipped with safety circuit to protect from overheating and total discharging. Other disadvantages include the fact that the batteries must be used regularly and that they age even if they are not used.
- Li-Ion Batteries are classified as dangerous goods in international transport law and have special regulations for carriage. The chemical contents of these batteries may catch fire if damaged or if improperly designed or assembled. For these reasons, there are safety regulations controlling the shipment of these types of batteries. Due to their volatility, worldwide li-ion battery supply chains are becoming more and more severely regulated.
North America to Dominate the Market
- North America is one of the strongest economies in the world, as the United States, Canada, and Mexico are tightly integrated markets. North America, including the United States and Canada, is the world’s largest market for electric power tools. Demand for power tools is directly proportional to the construction activity. Manufacturing activity in the region, is also expected to significantly improve, further boosting power tool demand.
- Power tool batteries market gains in North America are driven primarily by the bedrock US market, especially as a rebound in US housing, accelerated the number of professional tool users. Hence, the demand for power tool batteries.
- Increase in public spending on infrastructure is expected to be a significant driver, supported by continued positive growth in the residential and non-residential construction industry. The US residential building segment - which accounts for over 40% of total construction industry value is expected continue to see positive growth; driving the demand for power tools in the country.
- Construction activity in Canada continues to level off, following the last ten years of extraordinary growth, driven by a protracted global resource expansion. In addition to resource-sector development in oil & gas and mining, Canada’s construction sector benefited from coinciding investments in mega electric power generation and transmission, and other significant infrastructure. These combined investments propelled growth, well ahead of other countries, elevating Canada to one of the top 10 construction markets in the world.
- With continued growth in economy during the forecast period the power tool battery market in the region is expected to register a higher growth rate owing to increase in construction activities.
The global power tool batteries market is fragmented. Some of the key companies includes
Bosch Ltd, Hitachi, Ltd., Makita Corporation, Panasonic Corporation, RYOBI LIMITED, Samsung SDI Co Ltd, Sony Corp, and Stanley Black & Decker, Inc.
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