Battery Power - March/April 2013 - (Page 14)

Feature Lead Acid Batteries: A Proven Technology Marches Forward Anu Elizabeth Cherian, Senior Industry Analyst Frost & Sullivan The lead acid battery market is constantly faced with threats, from a market standpoint as well as from competitors’ technology threatening growth in this market. To address these market constraints, we’ll evaluate the viability of this technology for the next decade and highlight the end-user segments that are pertinent to sustaining its growth below. The Lead Acid Battery – The Technology Edge for Another Decade There are at least 10 reasons one can think of in terms of the lead acid batteries’ ability to withstand market pressures for another decade, at the very minimum. 1. The primary advantage of the lead acid battery comes from a cost standpoint. It is the cheapest and most available battery chemistry existing on the market. Its current price is at its lowest ever due to the fact that this technology uses easily available raw materials. 2. The market has maintained a long standing history in terms of outstanding performance and reliability. 3. The product has garnered means of easy outsourcing of manufacturing through Asia Pacific and regions where the combination of raw materials accessibility and cheap labor has aided in market growth. 4. Its profound market presence in virtually every end-user segment has made this technology even more popular in the global market. 5. The lead acid battery has been tried and proven by many end-user verticals for several years. 6. It has become the driving force to establish and safeguard data integrity, which in many cases could easily be lost in the event of a sudden power interruption. Data protection has become key in the world of commerce and has enabled the globe to interact in a more efficient manner through the information super highway. Therefore, uninterruptible power supplies (UPSs) that use stationary lead acid batteries have indeed paved the way for long term growth of this market. 7. Despite its market maturity, revenues have not declined in normal economic conditions indicating a mature market that continues to grow. 8. Despite the fact that many users express intense dissatisfaction with the lead acid battery, they are also not willing to take a risk in investing in a new technology on a standalone basis. Hence, they make calculated investments in some cases, holding on to the basic lead acid battery-based back up power infrastructure while experimenting on new technology. 9. Competition from upcoming battery technologies has not provided a strong enough threat to be disruptive enough to phase out lead acid batteries in the next decade. 10. The technology is simple, competition is profound and 14 Battery Power • March/April 2013 steady market growth indicates it is certainly not on the decline for the upcoming decade. The benefits of a simple technology, market competition and price wars are essential to establishing the kind of dynamics required to sustain market growth. Technology Tweaks that Would Benefit the Lead Acid Battery In evaluating the lead acid battery technology, there are a few areas that could essentially provide another boost to this technology to ensure its stronghold on the traditional end-user segments lasts longer, as outlined below. • The lead acid battery could certainly benefit from an increase in its energy density to bring it on par with that of lithium ion. • Another area of significant change would be in the power density. Right now, the lead acid battery is very low on power density and it absolutely could use a technology tweak to be able to sustain moments of high demand for power. • The size and weight reduction emanating from a change from liquid/gel based components to solid and safe alternatives could significantly enable space savings, an area of concern for the end-user. • A factor that was indeed causing a lot of tension in the lead acid battery market was the environmental viability of the battery, considering its unsafe disposal. This concern has been circumvented by the remarkable initiative taken by manufacturers to intensify recycling of lead acid. They have also increased the awareness and provided incentives for endusers to be cognizant of the environment. • Increasing product differentiation as well as price incentives could further enhance market growth. Stationary Lead Acid Market Statistics The latest research in the stationary lead acid battery market has indicated a compound annual growth rate (CAGR) of 6.8 percent from 2010 to 2017. Steady growth projections indicate the market faces little threat from competing technologies during this forecast period. The areas of strongest growth are in the UPS market as well as the telecommunications market. These markets are key in upholding the growth of the global UPS market. While around 60 percent of the revenues are from original equipment manufacturer (OEM) sales, aftermarket sales account for the remaining 40 percent of this market. Other Lead Acid Battery Markets In addition to the stationary lead acid battery market, the motive as well as the starting, lighting and ignition (SLI) battery market are markets that hold growth potential for lead acid batteries. Despite the heavy interest in pursuing cleaner mechanisms for automotives, the lead acid battery is most commonly employed for 90 percent of the automobiles worldwide in conjunction with the combustion engine. Hence, the upcoming

Table of Contents for the Digital Edition of Battery Power - March/April 2013

Battery Power - March/April 2013
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Battery Power - March/April 2013