Market evolution: Lithium ion batteries (CN 850760) — 2015–2025

Introduction

This report examines the evolution of EU trade in lithium-ion accumulators (Customs code 850760, excluding spent batteries) over the period 2015–2025. The decade under review has been one of transformative growth, driven by the global electrification of transport and the rapid expansion of consumer electronics and energy storage. The EU's trade position in this product category has undergone profound shifts: volumes, values, partner structures, and the Union's strategic vulnerability have all changed markedly. The overview dashboard provides the full data context for the analysis below.

1. Explosive growth in trade volumes masks a deepening structural deficit

Imports and exports both grew by an order of magnitude — but imports far outpaced exports

Over the 2015–2025 period, both EU imports and exports of lithium-ion batteries grew at extraordinary rates. Import value rose from €2.16 billion in 2015 to €28.50 billion in 2025, a 1,219% increase. In tonnage, imports surged from 54,788 tonnes to 1,617,631 tonnes — a 2,853% rise. Exports grew even faster in relative terms on the value side (+1,344%, from €343 million to €4.96 billion) and quantity (+2,842%, from 5,511 to 162,132 tonnes), yet remained an order of magnitude smaller than imports.

Source: General Overview — trade

Unit prices fell sharply, reflecting industrial scaling and cost reduction

A defining feature of the lithium-ion battery market over this decade has been dramatic cost deflation. Average import prices fell from €39,423/tonne to €17,618/tonne (−55.3%), while export prices dropped from €62,290/tonne to €30,588/tonne (−50.9%). These declines mirror the well-documented global trend of lithium-ion cell cost reductions driven by economies of scale, improved chemistries (e.g., the shift from NMC111 toward NMC811 and LFP), and massive manufacturing capacity expansions, particularly in China and South Korea.

The supplementary-unit data hints at a compositional shift toward smaller, higher-value cells

The supplementary quantity (number of items) tells a nuanced story. While import mass rose 2,853%, the number of items imported rose only 196% (from 262 million to 775 million pieces). This implies that the average mass per battery unit increased substantially — consistent with the shift from small consumer-electronics cells toward large-format EV and energy-storage cells. Conversely, the supplementary price per item imported surged from €8.24 to €36.75 (+346%), confirming that each imported unit became significantly more valuable. On the export side, the number of items shipped grew 978% (from 14.6 million to 157.8 million), but the per-item price only moved from €23.46 to €31.42 (+34%), suggesting EU exports remained oriented toward higher-unit-value segments but without the same pricing power gains seen on the import side.

Source: General Overview — trade

2. China's dominance has reshaped the supply geography, creating acute import concentration

China's share of EU imports grew from significant to overwhelming

The most striking structural shift in EU lithium-ion battery trade over the decade has been the rise of China as the overwhelmingly dominant supplier. In 2015, EU imports from China stood at €636 million; by 2025 they had reached €25.65 billion — a 3,933% increase and now representing approximately 90% of total import value. This expansion was fueled by China's massive investments in battery manufacturing capacity, the global rise of Chinese EV brands, and the vertically integrated supply chains built by firms such as CATL and BYD.

Source: Partners view

South Korea and Japan — once key suppliers — have lost relative ground

In 2015, South Korea and Japan together supplied roughly €869 million worth of batteries, representing about 40% of EU imports. By 2025, their combined share had fallen to around €1.03 billion, or barely 3.6% of total imports. South Korean imports actually declined in absolute value (−28%), while Japanese imports rose only modestly (+85%). This reflects the broader realignment of global battery manufacturing capacity toward China, as well as the competitive pressure on Korean and Japanese cell makers from Chinese producers offering lower-cost alternatives.

Import concentration (HHI) more than quadrupled, reaching "highly concentrated" levels

The Herfindahl-Hirschman Index for imports by value rose from 2,014 to 8,119 — a 303% increase that places the EU's lithium-ion battery import market firmly in the "highly concentrated" range. A similar pattern holds for import concentration by volume (from 2,330 to 8,861). This rising concentration is almost entirely a function of China's growing dominance and represents a significant supply-chain vulnerability for the EU.

In contrast, export concentration remained relatively stable and low (HHI by value from 1,013 to 1,084), reflecting the EU's more diversified export customer base.

Source: Concentration dashboard

Emerging alternative suppliers remain marginal

Several "China-plus-one" sourcing countries have seen rapid percentage growth — Vietnam (+1,624%), Hong Kong (+447%), and Malaysia (+48%) — but their absolute shares remain small relative to China. Vietnam, for example, reached €249 million in 2025, representing less than 1% of total EU battery imports. These emerging flows suggest early diversification efforts, but they have so far done little to reduce the EU's structural dependence on China.

Source: Partners view

3. Domestic production is ramping up but the EU remains structurally import-dependent

EU production has grown substantially, though it still lags behind demand

EU domestic production of lithium-ion accumulators (captured under Prodcom code 27.20.23.50) rose from 73 million items / €1.86 billion in 2015 to 199 million items / €18.0 billion in 2025 — an increase of 173% by count and 867% by value. This growth reflects the wave of "gigafactory" investments across Europe, including plants by Northvolt (Sweden), CATL (Germany, Hungary), Samsung SDI (Hungary), LG Energy Solution (Poland), and ACC (France, Germany). However, given that imports reached €28.5 billion in 2025, domestic production still covers only a fraction of total EU demand.

Source: Production volumes

Net import reliance has declined but remains high

The EU's net import reliance fell from 69.2% in 2015 to 47.8% in 2025 (−31%). This improvement, while meaningful, means that roughly half of the EU's lithium-ion battery consumption is still met by imports. Notably, the ratio reached a low of 26.2% at some point during the period before rising again — suggesting that new production capacity came online faster than demand grew for a time, but that demand acceleration (particularly from the EV sector) subsequently outstripped domestic capacity expansion.

Similarly, trade intensity declined from 94.5% to 73.3%, while export propensity fell from 77.9% to 38.6%. The sharper decline in export propensity suggests that more of the EU's growing production is being absorbed domestically rather than shipped abroad — a logical consequence of surging EV adoption within the EU.

Source: Autonomy & Vulnerability section

Central and Eastern European economies have emerged as the EU's battery production hubs

Specialisation data for 2025 reveals that Hungary (RSCA: 0.78, RCA: 8.21), Poland (RSCA: 0.42, RCA: 2.44), and Czechia (RSCA: 0.41, RCA: 2.36) are the most specialised EU producers of lithium-ion batteries. These countries have attracted major foreign direct investment from Asian cell manufacturers — notably Samsung SDI and CATL in Hungary, LG Energy Solution in Poland, and various suppliers in Czechia. Their strong specialisation scores reflect the success of industrial policy strategies centred on automotive-sector clusters. Germany, while the EU's largest single importer (€10.2 billion in 2025) and exporter (€1.9 billion), has a lower specialisation score given the broader diversity of its manufacturing base.

Source: Specialisation view

Export flows show early signs of regional diversification

EU exports are directed primarily to the United States (€1.10 billion, +2,382%), Mexico (€435 million, +35,182%), the United Kingdom (€727 million, +798%), China (€448 million, +2,181%), Türkiye (€509 million, +6,079%), and Switzerland (€321 million, +818%). The rapid growth in exports to Mexico and Türkiye is noteworthy and likely reflects the expansion of EU-based automotive OEM assembly operations in those countries. Exports to Ukraine also surged (+35,890%), potentially linked to energy-storage and defence-related demand.

Source: Partners view

Conclusion

The EU's lithium-ion battery market has undergone a decade of radical transformation between 2015 and 2025. Demand has exploded — driven by electromobility, portable electronics, and grid-scale energy storage — with import volumes growing nearly 29-fold. While unit costs have fallen dramatically in line with global technology-learning curves, the sheer scale of demand growth has caused the EU's trade deficit in this product to balloon from €1.8 billion to €23.5 billion.

The most consequential structural shift has been the concentration of supply around China, whose share of EU imports has risen to approximately 90% by value, pushing the import HHI into highly concentrated territory. This poses a significant strategic vulnerability, particularly in the context of EU policy ambitions around battery sovereignty (e.g., the European Battery Alliance and the Battery Regulation).

Signs of resilience are emerging: EU domestic production has grown nearly nine-fold in value, net import reliance has declined to 48%, and new gigafactory capacity is being built across Central and Eastern Europe. Yet the gap between domestic production and total consumption remains wide. The coming years will be critical in determining whether the EU can translate its policy commitments and industrial investments into a meaningfully more autonomous position in this strategically vital supply chain.