Some of the key challenges faced by the alkaline battery manufacturers include:
Competition from Alternative Chemistries: Alkaline batteries face threat from primary lithium batteries and rechargeable batteries in consumer electronics application. Primary lithium batteries possess higher energy density, thereby offering better performance and lasts longer compared with the alkaline batteries. In many high-drain consumer applications, nickel metal hydride (NiMH) rechargeable batteries are replacing alkaline batteries as they offer better performance and lasts much longer than the disposable alkaline batteries. The impact of this challenge is likely to be medium in the short- to mid-term but is expected to be high in the long term as we will see alkaline batteries being replaced by alternative chemistries.
Increasing Cost of Raw Materials: Disposable batteries witnessed a pressure on manufacturing cost owing to the increase in the price of raw materials, such as zinc and electrolytic manganese dioxide (EMD). The cost of key material EMD is high. EMD plays a key role in the performance of alkaline batteries and is required at high-purity stage which augments high price. This trend pressures the alkaline battery manufacturers as their profit margin is affected owing to this rise in the cost of the raw material. This poses a major challenge to the alkaline battery manufacturers, as the rise in the price of batteries is expected to make consumers prefer alternative batteries. Impact of this challenge is likely to be medium during the short and mid-term and low during the long term.
Presence of Counterfeit Batteries: Alkaline batteries which appear identical or confusingly similar to a branded battery are referred as counterfeit batteries. These batteries are designed to mislead consumers intentionally by appearing very similar to branded batteries. However, the performance, efficiency and leak proof features offered by branded batteries could not be expected in these counterfeits. Branded batteries are constructed with a vent to release the internal pressure within the battery that prevents the battery from explosion or electrolyte leakage. Hence counterfeit batteries impose safety issues along with harming the brand reputation of key battery manufacturers. The impact of this challenge is medium during the short- to mid-term and low during the long term.
Post time: Feb-27-2023
