EV Battery Pack Cooling System Market – By Propulsion Type , By Cooling System , By Battery Type , By End-User , By Geography – Global Opportunity Analysis & Industry Forecast, 2025-2031
EV Battery Pack Cooling System Market Overview:
EV Battery Pack Cooling System Market Size is valued at $9.08 Billion by 2031, and is anticipated to grow at a CAGR of 16.27% during the forecast period 2025-2031. The EV Battery Pack Cooling System Market is witnessing rapid growth, driven by the increasing adoption of electric vehicles (EVs) worldwide. Efficient cooling systems are essential for maintaining battery performance, longevity, and safety by preventing overheating and ensuring optimal temperature regulation. As governments push for stricter emissions regulations and automakers invest heavily in EV technology, the demand for advanced battery cooling solutions is rising. Key players in this market are focusing on liquid cooling systems, which offer superior thermal management compared to air cooling. Additionally, innovations such as phase change materials (PCM) and immersive cooling technologies are gaining traction. As EVs become more advanced, manufacturers are incorporating smart and AI-powered thermal management systems to optimize battery performance. These systems use real-time data analytics, sensors, and machine learning algorithms to adjust cooling levels dynamically, ensuring energy efficiency and improved safety.
EV Battery Pack Cooling System Market - Report Coverage:
The “EV Battery Pack Cooling System Market Market Report - Forecast (2025-2031)” by IndustryARC, covers an in-depth analysis of the following segments in the EV Battery Pack Cooling System Market.
COVID-19 / Ukraine Crisis - Impact Analysis:
- The COVID-19 pandemic had a mixed impact on the EV Battery Pack Cooling System Market. In the initial phases, the market faced disruptions due to supply chain constraints, factory shutdowns, and reduced vehicle production, leading to a temporary decline in demand for battery cooling systems. The global shortage of semiconductor chips further delayed EV production, affecting the adoption of advanced cooling technologies. However, as economies reopened, governments worldwide accelerated investments in electric mobility as part of green recovery plans, boosting the demand for EVs and, consequently, battery cooling solutions. Additionally, the pandemic reinforced the importance of battery efficiency and longevity, prompting automakers to invest more in advanced liquid cooling systems and smart thermal management technologies. The post-pandemic surge in EV adoption, driven by stringent emissions regulations and incentives, has ultimately revitalized the market, positioning it for strong growth in the coming years.
- The Russia-Ukraine war has had a significant impact on the EV Battery Pack Cooling System Market, primarily through disruptions in the global supply chain and rising raw material costs. Ukraine is a key supplier of neon gas, essential for semiconductor manufacturing, while Russia is a major exporter of nickel, aluminum, and copper, which are crucial for EV batteries and cooling systems. The conflict led to supply shortages and price hikes, increasing production costs for EV battery components, including cooling systems. Additionally, the geopolitical uncertainty and rising energy prices slowed EV adoption in some regions, as consumers and automakers faced higher costs and inflationary pressures. However, the crisis also accelerated the shift toward energy independence and electrification, particularly in Europe, where governments ramped up EV incentives and investments in local battery supply chains. Despite initial setbacks, the market has rebounded as automakers seek alternative raw material sources and invest in more efficient and sustainable battery cooling technologies to mitigate supply chain risks.
Key Takeaways:
North America Dominates the Market Growth
On the basis of geography, North America accounted for the largest share of around 65% in 2024 of the EV Battery Pack Cooling System Market due to its strong EV adoption rate, advanced automotive infrastructure, and increasing investments in battery technology. The United States, in particular, has witnessed rapid growth in electric vehicle production, driven by government policies such as the Inflation Reduction Act (IRA) and state-level zero-emission vehicle (ZEV) mandates, which have incentivized both automakers and consumers to transition toward electric mobility. A key factor contributing to North America's market leadership is the presence of major EV manufacturers such as Tesla, General Motors, and Ford, all of which are heavily investing in advanced battery thermal management solutions. Tesla, for instance, has pioneered liquid-based cooling systems, which are now becoming the industry standard for high-performance EVs. Additionally, collaborations between automakers and battery technology firms, such as LG Energy Solution, Panasonic, and CATL’s expansion into the U.S., have strengthened the region’s supply chain for EV components, including battery pack cooling systems. Furthermore, the rise of fast-charging infrastructure in North America has increased the demand for efficient thermal management solutions, as high-power charging generates more heat within battery packs. With strong government support, technological advancements, and a growing EV ecosystem, North America is set to maintain its leadership in the EV Battery Pack Cooling System Market in the coming years.
Battery Electric Vehicles (BEVs) Dominated the EV Battery Pack Cooling System Market
On the basis of propulsion type, Battery Electric Vehicles (BEVs) held the highest segmental market share of around 71.3% in 2024. The dominance of BEVs is primarily driven by their higher battery capacity requirements, which necessitate advanced thermal management solutions. Unlike Plug-in Hybrid Electric Vehicles (PHEVs) or Hybrid Electric Vehicles (HEVs), BEVs rely entirely on battery power, making efficient cooling systems critical for ensuring optimal performance, safety, and longevity. The increasing adoption of BEVs, particularly in regions like North America, Europe, and China, has significantly boosted demand for liquid-based cooling systems. Leading BEV manufacturers such as Tesla, BYD, Volkswagen, and Hyundai are equipping their high-performance electric models with advanced liquid cooling technologies, as they offer better heat dissipation and improved battery efficiency compared to air-cooled systems. Additionally, the rise of fast-charging networks—which generate significant heat during high-power charging—has further driven the need for efficient thermal management in BEVs. Government policies and incentives promoting zero-emission vehicles, coupled with technological advancements in high-energy-density batteries, have accelerated BEV sales, thereby increasing demand for battery pack cooling solutions. With BEVs projected to dominate over 75% of the EV market by 2030, the EV Battery Pack Cooling System Market will continue to expand, driven by innovations in liquid cooling, phase change materials (PCM), and AI-based thermal management systems.
Liquid Cooling Systems Leads the EV Battery Pack Cooling System Market
On the basis of cooling system, Liquid Cooling Systems held the highest segmental market share of 56% in 2024. This dominance is driven by their superior heat dissipation capabilities, which enhance battery performance, safety, and lifespan compared to traditional air-cooled systems. As modern EVs adopt high-energy-density batteries and support fast charging, effective thermal management becomes crucial, positioning liquid cooling as the preferred solution. Unlike air cooling, which struggles to regulate temperature uniformly, liquid cooling uses coolant channels or cold plates to circulate heat away from battery cells, ensuring efficient and consistent temperature control. This is especially vital in Battery Electric Vehicles (BEVs), which operate at higher power levels and generate more heat than hybrid models. Leading automakers such as Tesla, BYD, Volkswagen, and BMW have widely adopted liquid-based cooling solutions, integrating advanced glycol or dielectric coolants for improved thermal efficiency. In September 2021, MAHLE, the specialist for thermal management, i.e., the heating and cooling of the vehicle interior and components, has developed a completely new cooling system for batteries. Cooling is a major challenge, especially when it comes to fast charging battery-powered electric vehicles. The Stuttgart-based automotive supplier relies on immersion cooling as a key technology. The rapid expansion of fast-charging networks (150 kW and above) has further accelerated the shift to liquid cooling, as high-power charging generates excessive heat, which can degrade battery performance. Additionally, advancements in phase change materials (PCM) and direct immersion cooling are pushing liquid cooling technologies toward next-generation thermal management solutions. With growing demand for high-performance EVs and stricter battery safety regulations, the liquid cooling system segment is expected to exceed 70% market share by 2030, making it the dominant thermal management solution in the EV Battery Pack Cooling System Market.
Lithium-Ion Batteries Dominates the EV Battery Pack Cooling System Market
On the basis of battery type, Lithium-Ion Batteries held the highest segmental market share of around 87% in 2024. Their dominance is driven by their high energy density, longer lifespan, and superior efficiency compared to other battery chemistries like lead-acid or nickel-metal hydride (NiMH). As Battery Electric Vehicles (BEVs) and Plug-in Hybrid Electric Vehicles (PHEVs) continue to gain market share, the reliance on lithium-ion batteries has intensified, thereby driving the demand for advanced cooling solutions. Lithium-ion batteries generate significant heat during charging, discharging, and fast-charging cycles, making effective thermal management crucial. This has led to the widespread adoption of liquid cooling systems, which provide superior heat dissipation compared to air-cooled solutions. Leading EV manufacturers, including Tesla, BYD, Volkswagen, and Hyundai, use lithium-ion battery packs integrated with advanced cooling systems to maintain optimal temperature ranges, thereby ensuring performance, safety, and longevity. In April 2025, University of Michigan engineers have developed a modified manufacturing process for electric vehicle (EV) batteries that significantly enhances charging speeds in cold weather. The innovation addresses one of the biggest concerns for EV adoption—reduced efficiency in low temperatures. Additionally, the development of next-generation lithium-ion batteries, such as solid-state and lithium iron phosphate (LFP) variants, still requires effective thermal regulation, keeping cooling solutions essential for EV performance.
Passenger Vehicles Dominates the EV Battery Pack Cooling System Market
On the basis of end-users, passenger vehicles held the highest segmental market share of over 63% in 2024, driven by the rapid electrification of passenger cars, fueled by government incentives, increasing consumer adoption of EVs, and advancements in battery technology. Major automakers, including Tesla, Volkswagen, BYD, and Hyundai, are aggressively expanding their battery-electric vehicle (BEV) lineups, further driving demand for advanced thermal management solutions. Passenger EVs require efficient battery cooling systems to maintain optimal performance, safety, and longevity. With the increasing adoption of high-energy-density batteries and the expansion of fast-charging infrastructure, thermal management has become a critical focus area. Liquid cooling systems have emerged as the dominant solution for passenger EVs due to their superior heat dissipation capabilities, ensuring consistent battery temperatures even under extreme conditions. Additionally, the growing trend of long-range and high-performance electric cars has intensified the need for effective cooling solutions. Automakers are integrating liquid-based cooling technologies to enhance charging efficiency, prevent thermal runaway, and extend battery life. The rise of luxury EVs and SUVs, which have larger battery capacities, has further boosted the adoption of liquid cooling systems. As governments worldwide continue pushing for zero-emission vehicles, and passenger EV sales outpace commercial EV adoption, the passenger vehicle segment will remain the primary driver of growth in the EV Battery Pack Cooling System Market.
Growing Demand for EV Battery Pack Cooling System Market Due to Rising EV Adoption and Government Regulations
The increasing adoption of electric vehicles (EVs) worldwide, driven by stringent government regulations on emissions and incentives for EV manufacturing, is a primary driver for the EV Battery Pack Cooling System Market. Governments across North America, Europe, and Asia-Pacific have implemented strict CO₂ emission targets and are phasing out internal combustion engine (ICE) vehicles, accelerating EV production. Policies such as the Inflation Reduction Act (IRA) in the U.S., the European Green Deal, and China’s NEV (New Energy Vehicle) mandates are pushing automakers to expand their EV portfolios. As EV penetration grows, efficient thermal management becomes crucial for maintaining battery performance, safety, and lifespan. Overheating issues can lead to thermal runaway, reducing battery efficiency and increasing the risk of fires. To comply with safety standards and enhance EV reliability, automakers are investing heavily in liquid cooling systems, which offer superior heat dissipation compared to traditional air-cooled methods. Additionally, advancements in fast-charging infrastructure further necessitate advanced battery cooling solutions, as high-power charging generates excessive heat. The continued push for zero-emission transportation, coupled with investments in battery technology and manufacturing, will drive sustained demand for battery pack cooling systems, making it a critical component in the EV ecosystem. As a result, suppliers of cooling technologies, such as Modine, Mahle, and Valeo, are expanding their product lines to meet the growing demand for high-performance, energy-efficient cooling systems in next-generation EVs.
Negative Impact on the EV Battery Pack Cooling System Market Due to High Cost of Advanced Cooling Systems
The EV Battery Pack Cooling System Market faces a significant challenge in terms of high costs associated with advanced thermal management solutions. Liquid cooling systems, which dominate the market, require specialized components such as coolant pumps, heat exchangers, and thermal interface materials, all of which add to the overall cost of EV manufacturing. Additionally, the integration of these systems increases design complexity, requiring rigorous testing and validation to ensure battery safety and efficiency. For automakers, balancing performance, safety, and cost-effectiveness remains a major challenge. Luxury and high-performance EVs can afford expensive cooling technologies, but mass-market EVs struggle with cost constraints, making it difficult for manufacturers to implement sophisticated cooling solutions without significantly increasing vehicle prices. This cost barrier slows down wider EV adoption, particularly in price-sensitive regions. As a solution, industry players are investing in new materials and innovative cooling techniques, such as phase change materials (PCM) and direct immersion cooling, to enhance efficiency while reducing costs. However, achieving mass production scalability and cost optimization remains an ongoing hurdle that must be addressed for sustained market growth.
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Key Market Players:
Product launches, approvals, patents and events, acquisitions, partnerships and collaborations are key strategies adopted by players in the EV Battery Pack Cooling System Market. The top 10 companies in this industry are listed below:
- Boyd Corporation
- E-MERSIV
- Hanon Systems
- Kreisel Electric
- MAHLE GmbH
- Miba AG
- Modine Manufacturing Company
- RIGID HVAC
- Valeo
- VOSS Automotive, Inc.
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