As the global automotive industry continues to undergo a profound transformation, EVs are leading the charge toward a more decarbonized future. Despite significant advancements, automakers are still facing significant challenges in scaling production and adoption. Today, two of the biggest pain points remain the high cost of batteries and their reliability, both critical factors in making EVs more accessible and competitive. Indeed, reducing costs without compromising performance is essential for mass-market viability, while ensuring long-term reliability is key to consumer confidence and regulatory compliance. As such, addressing these issues is necessary to accelerate EV adoption and ensure the industry’s long-term viability.
The EV Market and Current Demand
Over the past few years, the EV market has experienced ongoing growth. EV adoption has been growing at an impressive pace, with sales reaching new milestones each year. In 2022, automakers delivered 10.5 million EVs worldwide, marking a 55% increase from the previous year. This momentum continued in 2023, with global EV sales rising to 14 million, a 35% jump, accounting for approximately 18% of all cars sold. The trend accelerated further in 2024, setting a new record with 17.1 million EVs sold, a 25% increase from 2023. Projections for 2025 indicate that sales will surpass 20 million, reflecting an 18% rise from the previous year.
On a more regional scale, EV sales in 2024 reflected varying trends across key markets. China saw a record-breaking year, with 11 million EVs sold, a 40% increase from the previous year, further solidifying its position as the global leader in electrification. In the United States, EV adoption also reached new heights, with 1.3 million units sold, marking a 7.3% rise from 2023. Meanwhile, the European market experienced a slight decline, with nearly 2 million new passenger EV registrations across the EU28, a 1.2% drop from the previous year. Despite this dip, the EU still has long-term decarbonization plans and will be enforcing strict CO2 reduction targets as it aims for zero emissions from new cars by 2035.
The Two Main Pain Points for EV OEMs
While EV adoption continues to rise with record-breaking sales, the industry is facing mounting pressure to enhance affordability and reliability. However, manufacturers continue to grapple with two major hurdles that threaten progress and continued EV adoptability: the high cost of batteries and concerns over their reliability.
High Battery Costs
Currently, EVs come at a higher price than traditional internal combustion engine vehicles mainly because of the high cost of their batteries. Indeed, the cost of EV batteries remains a significant barrier to broader adoption, with them accounting for up to 40% of an EV’s total cost. In 2024, the average cost of lithium-ion battery packs decreased to $115/kWh, reflecting a 20% reduction from the previous year. Despite this drop, the average battery still costs around $9,000, and the cost of replacing an EV battery in the U.S. can range from $5,000 to $20,000, depending on factors such as the model, battery size, and manufacturer. While technological advancements can drive down battery prices, the rising demand for essential raw materials, such as lithium, cobalt, and nickel, has also led to increased costs.
Battery Reliability
In addition to high battery costs, reliability is a pillar of consumer confidence in EV technology. From battery longevity to charging lifecycle to overall health, various challenges persist that impact the dependability of EVs. Indeed, many issues stem from battery degradation over time, performance and charging systems. While studies have shown that EV batteries degrade at an average rate of 1.8% per year, suggesting a potential lifespan of 15 to 20 years under moderate conditions, real-world factors such as frequent use of DC fast charging and exposure to extreme temperatures can accelerate this degradation, leading to reduced capacity and performance.
Safety concerns have also emerged due to battery-related incidents. Indeed, Italy’s competition watchdog recently initiated investigations into major automakers, including Tesla and Volkswagen, over potential failures in informing customers about battery performance limitations and warranties. Additionally, recalls have been issued due to battery defects posing fire risks. For instance, Audi and Porsche recalled 34,000 EVs over a battery fault that could lead to fires, advising owners to limit their battery charge to below 80% until repairs were made.
Lowering Battery Costs and Improving Reliability with Addionics
Addionics’ 3D Current Collectors address two of the biggest challenges in EV adoption: cost and reliability. Unlike conventional 2D battery structures, this 3D architecture enhances energy density by allowing a greater volume of active material to be embedded while reducing the need for inactive components. The result is a more efficient battery with improved performance and lower production costs, making EVs more accessible to both manufacturers and consumers.
Beyond cost reduction, Addionics 3D Current Collectors improve structural integrity, reduce internal resistance, and optimize thermal management. These enhancements increase battery stability and safety, addressing concerns related to degradation and performance over time. This leads to an extended battery lifespan while mitigating risks associated with overheating and potential safety issues.
Moreover, by being designed as a drop-in solution, Addionics seamlessly integrates into existing battery production lines without requiring costly modifications. Its chemistry-agnostic design ensures compatibility with both current and emerging battery chemistries, future-proofing EV technology as the industry continues to evolve. With leading OEMs already leveraging this solution, Addionics is driving the next stage of battery innovation where affordability and reliability are no longer barriers to widespread EV adoption.
Find out more about Addionics’ technology or contact us for collaboration opportunities.