What’s next for EV batteries in 2026

MIT Technology Review’s What’s Next series looks across industries, trends, and technologies to give you a first look at the future. You can read the rest of them here.

Demand for electric vehicles and the batteries that power them has never been hotter.

In 2025, EVs made up over a quarter of new vehicle sales globally, up from less than 5% in 2020. Some regions are seeing even higher uptake: In China, more than 50% of new vehicle sales last year were battery electric or plug-in hybrids. In Europe, more purely electric vehicles hit the roads in December than gas-powered ones. (The US is the notable exception here, dragging down the global average with a small sales decline from 2024.)

As EVs become increasingly common on the roads, the battery world is growing too. Looking ahead, we could soon see wider adoption of new chemistries, including some that deliver lower costs or higher performance. Meanwhile, the geopolitics of batteries are shifting, and so is the policy landscape. Here’s what’s coming next for EV batteries in 2026 and beyond.

A big opportunity for sodium-ion batteries

Lithium-ion batteries are the default chemistry used in EVs, personal devices, and even stationary storage systems on the grid today. But in a tough environment in some markets like the US, there’s a growing interest in cheaper alternatives. Automakers right now largely care just about batteries’ cost, regardless of performance improvements, says Kara Rodby, a technical principal at Volta Energy Technologies, a venture capital firm that focuses on energy storage technology.

Sodium-ion cells have long been held up as a potentially less expensive alternative to lithium. The batteries are limited in their energy density, so they deliver a shorter range than lithium-ion. But sodium is also more abundant, so they could be cheaper.

Sodium’s growth has been cursed, however, by the very success of lithium-based batteries, says Shirley Meng, a professor of molecular engineering at the University of Chicago. A lithium-ion battery cell cost $568 per kilowatt-hour in 2013, but that cost had fallen to just $74 per kilowatt-hour by 2025—quite the moving target for cheaper alternatives to chase.

Sodium-ion batteries currently cost about $59 per kilowatt-hour on average. That’s less expensive than the average lithium-ion battery. But if you consider only lithium iron phosphate (LFP) cells, a lower-end type of lithium-ion battery that averages $52 per kilowatt-hour, sodium is still more expensive today. 

We could soon see an opening for sodium-batteries, though. Lithium prices have been ticking up in recent months, a shift that could soon slow or reverse the steady downward march of prices for lithium-based batteries. 

Sodium-ion batteries are already being used commercially, largely for stationary storage on the grid. But we’re starting to see sodium-ion cells incorporated into vehicles, too. The Chinese companies Yadea, JMEV, and HiNa Battery have all started producing sodium-ion batteries in limited numbers for EVs, including small, short-range cars and electric scooters that don’t require a battery with high energy density. CATL, a Chinese battery company that’s the world’s largest, says it recently began producing sodium-ion cells. The company plans to launch its first EV using the chemistry by the middle of this year. 

Today, both production and demand for sodium-ion batteries are heavily centered in China. That’s likely to continue, especially after a cutback in tax credits and other financial support for the battery and EV industries in the US. One of the biggest sodium-battery companies in the US, Natron, ceased operations last year after running into funding issues.

We could also see progress in sodium-ion research: Companies and researchers are developing new materials for components including the electrolyte and electrodes, so the cells could get more comparable to lower-end lithium-ion cells in terms of energy density, Meng says. 

Major tests for solid-state batteries

As we enter the second half of this decade, many eyes in the battery world are on big promises and claims about solid-state batteries.

These batteries could pack more energy into a smaller package by removing the liquid electrolyte, the material that ions move through when a battery is charging and discharging. With a higher energy density, they could unlock longer-range EVs.

Companies have been promising solid-state batteries for years. Toyota, for example, once planned to have them in vehicles by 2020. That timeline has been delayed several times, though the company says it’s now on track to launch the new cells in cars in 2027 or 2028.

Historically, battery makers have struggled to produce solid-state batteries at the scale needed to deliver a commercially relevant supply for EVs. There’s been progress in manufacturing techniques, though, and companies could soon actually make good on their promises, Meng says. 

Factorial Energy, a US-based company making solid-state batteries, provided cells for a Mercedes test vehicle that drove over 745 miles on a single charge in a real-world test in September. The company says it plans to bring its tech to market as soon as 2027. Quantumscape, another major solid-state player in the US, is testing its cells with automotive partners and plans to have its batteries in commercial production later this decade.  

Before we see true solid-state batteries, we could see hybrid technologies, often referred to as semi-solid-state batteries. These commonly use materials like gel electrolytes, reducing the liquid inside cells without removing it entirely. Many Chinese companies are looking to build semi-solid-state batteries before transitioning to entirely solid-state ones, says Evelina Stoikou, head of battery technologies and supply chains at BloombergNEF, an energy consultancy.

A global patchwork

The picture for the near future of the EV industry looks drastically different depending on where you’re standing.

Last year, China overtook Japan as the country with the most global auto sales. And more than one in three EVs made in 2025 had a CATL battery in it. Simply put, China is dominating the global battery industry, and that doesn’t seem likely to change anytime soon.

China’s influence outside its domestic market is growing especially quickly. CATL is expected to begin production this year at its second European site; the factory, located in Hungary, is an $8.2 billion project that will supply automakers including BMW and the Mercedes-Benz group. Canada recently signed a deal that will lower the import tax on Chinese EVs from 100% to roughly 6%, effectively opening the Canadian market for Chinese EVs.

Some countries that haven’t historically been major EV markets could become bigger players in the second half of the decade. Annual EV sales in Thailand and Vietnam, where the market was virtually nonexistent just a few years ago, broke 100,000 in 2025. Brazil, in particular, could see its new EV sales more than double in 2026 as major automakers including Volkswagen and BYD set up or ramp up production in the country. 

On the flip side, EVs are facing a real test in 2026 in the US, as this will be the first calendar year after the sunset of federal tax credits that were designed to push more drivers to purchase the vehicles. With those credits gone, growth in sales is expected to continue lagging. 

One bright spot for batteries in the US is outside the EV market altogether. Battery manufacturers are starting to produce low-cost LFP batteries in the US, largely for energy storage applications. LG opened a massive factory to make LFP batteries in mid-2025 in Michigan, and the Korean battery company SK On plans to start making LFP batteries at its facility in Georgia later this year. Those plants could help battery companies cash in on investments as the US EV market faces major headwinds. 

Even as the US lags behind, the world is electrifying transportation. By 2030, 40% of new vehicles sold around the world are projected to be electric. As we approach that milestone, expect to see more global players, a wider selection of EVs, and an even wider menu of batteries to power them.