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It All Starts Here – A Review of the Automotive Starter Battery Market

Consolidation among the major battery manufacturers continues to shape the industry, particularly across Europe. Johann-Friedrich Dempwolff, Vice President Sales OEM/OES, VB Autobatterie GmbH, said: “If you look back to 1990, in Germany there were ten battery producers. In the UK there were at least five producers. In France there were several. In Italy there were over 50 very small businesses. All this has dramatically changed over the last decade. There are only a few strong players left in the marketplace.”

“The result of tighter environmental requirements, together with other legislation, has been the closure of plants in Western Europe and a move to the Far East, particularly China, and to super-plants,” said Lucas Batteries’ David Haseler. “We have recently announced the closure of our Birmingham [UK] factory for manufacturing, and will be sourcing from companies in Asia. Our advantage is that these are company-owned plants which will allow us to maintain a close control over supply and quality.”

Today, four valve regulated lead-acid battery manufacturers – of which three are American — have emerged as global players: Johnson Controls, Delphi, Exide Technologies and Yuasa. These four companies collectively control 55% of the global market. Johnson Controls recently signaled its intention to buy Delphi’s global battery business for $212.5 million. Yuasa recently merged with Japan Storage Battery, forming GS Yuasa Corp. Yuasa holds an 8% share of the global lead storage battery market while Japan Storage Battery has a 6% share. Their combined market share of 14% ranks them in third place in the global market. Lifepo4 Battery Manufacturers

The flood of imported batteries from tiger economies (such as China, Thailand, Indonesia and Malaysia) is also posing a serious challenge to European manufacturers. That has become a double-whammy for UK-based supplies since the imported units are especially cheap due to the weak dollar. Perversely, the Asian manufacturers have driven up the cost of lead because their consumption of it is so high. The price of oil is also driving up the cost of polypropylene used in battery manufacture.

Technically speaking, the starter battery market has moved completely to calcium-calcium technology, and the change is now almost complete in the aftermarket, certainly in developed countries. Lucas Batteries’ Haseler said: “There is a fast-growing requirement for sealed [non-accessible] lids with re-condensing features in the OE market, and this changeover should be complete within a few years. This reflects the trend in the automotive industry for sealed units. This is being closely followed by the requirement for a ‘tip-tilt’ lid, that is, a lid that will not allow any acid to leak out of the battery for at least 30 minutes with the battery at any angle. If the battery is still being charged, this time reduces to two minutes. This is achieved by a more complex labyrinth within the lid. This trend originated in Germany. The aftermarket can be expected to follow within a year or so. Sealed and tip-tilt lids are a consequence of the trend for greater safety and, in particular, the need to prevent access to the acid within a battery. Following the unsuccessful launch of VRLA [valve regulated lead acid batteries] into the OE market a few years ago, a second wave is now underway in companies such as Daimler-Chrysler and Citroen with its recently-launched C3. The Citroen C3 is the first of the long-heralded stop-start cars, in which the engine stops whenever the car stops, leaving the battery to power all the electrical system. This regime will increase the cycling loads on the battery, a demand which VRLA technology is best suited to supply. The drive for fewer emissions, associated with the need for better fuel-consumption, has clearly resulted in the move to stop-start cars.”

Austria’s Banner GmbH also sees the battery business moving toward calcium-calcium technology, particularly for cars introduced from 1997 onwards. Andreas Sperl, marketing manager, Banner GmbH, said: “These vehicles typically require modern charge management, higher voltage and maintenance free batteries. Given that batteries are often situated in places where the driver cannot see it — let alone the brand name — the battery must be maintenance free, leak proof and spill proof.”

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