Why LFP Became The Dominant EV Battery Chemistry In 2025

• LFP was the fastest growing battery chemistry in 2025, with demand increasing 48%, according to research firm RhoMotion.
• It has overtaken nickel-based packs to become the dominant battery chemistry in the world.
• China spearheaded this growth, followed by Europe and some Asian countries.

The rollout of low-cost lithium-iron phosphate (LFP) batteries surpassed deployments of traditional nickel-based chemistries in electric vehicles in 2025 for the very first time, EV Magazine reported, citing data from the research firm RhoMotion. That marks a significant shift for the global battery industry, and its yet another sign of China’s continued dominance here.

For years, automakers leaned heavily on nickel-manganese-cobalt (NMC) batteries, largely because they benefited from a mature supply chain and higher energy density that delivered desirable driving range on EVs. (Most U.S.-market EVs use NMC batteries.) 

But those advantages have come at a cost. Nickel- and cobalt-heavy batteries are expensive to mine, they’re environmentally intensive and remain tied to controversial supply chains that involve labor and human rights violations, particularly in the Democratic Republic of Congo.

Ford LFP battery cells

As a result, battery makers have been accelerating their shift toward nickel-free chemistries such as LFP.

Chinese automakers and battery companies have been leading that shift, thanks to LFP’s lower costs, reduced dependence on troubled materials and a narrowing energy-density gap with NMC batteries. 

By last year, LFP batteries accounted for more than half of global EV battery deployments, RhoMotion said. NMC batteries still retain an edge on energy density, but automakers have found ways to offset that disadvantage. Cell-to-pack and cell-to-chassis designs allow more cells to be squeezed into similar spaces. Optimized anode and cathode materials are helping close that performance gap even further.

And China is absolutely crushing it when it comes to LFP adoption. Between January and November last year, more than 80% of EVs sold in the country were equipped with LFP batteries. And that dominance is also spilling overseas.

BYD Seagull (China Spec)

Photo by: Kevin Williams/InsideEVs

Europe and Asia (excluding China) accounted for roughly 75% of last year’s global LFP growth, driven largely by a surge of Chinese EVs entering overseas markets. In Europe, Chinese automakers accounted for a record 12.8% of the EV market in November, more than doubling their share from a year earlier, Bloomberg reported, citing numbers from Dataforce. BYD, Leapmotor and Chery all posted strong growth across the region in 2025. China’s CATL is by far the leading company in the LFP market, and last year, about one-third of all EVs sold had CATL battery cells. You do the math. 

Chinese battery giants are pushing aggressively into local LFP production in Europe, both to reduce their exposure to tariffs and also to stay close to automakers. Both BYD and CATL are building battery factories in Hungary. CATL already operates a plant in Germany and has another one planned in Spain in partnership with Stellantis.

North America was the only region to see LFP deployments decline in 2025. The U.S. has effectively blocked China-made batteries from entering the country through tariffs and strict sourcing rules under the Biden-era Inflation Reduction Act, leaving only a handful of LFP-equipped EVs on the U.S. market.

2027 Chevrolet Bolt

Photo by: Patrick George

Tesla briefly offered LFP batteries on the base Model 3 in the U.S., but discontinued that trim in 2024 due to tariffs. Rivian and Ford still use LFP packs on base versions of the R1S, R1T and Mustang Mach-E. However, LFP is expected to undergo somewhat of a resurgence in the U.S. thanks to more affordable EVs like the new Chevrolet Bolt and Ford’s upcoming $30,000 electric truck.

LFP is still poised to grow in the U.S., but the path will look different from what’s happening in Europe and China. Much of that momentum is expected to come from domestic production of battery energy storage systems (BESS), rather than passenger EVs alone.

After the end of the $7,500 federal tax credit, several battery makers in the U.S., including LG Energy Solution, Tesla and SK On, adjusted their battery manufacturing capacity for the ESS market, which is growing much faster than EVs.

Contact the author: suvrat.kothari@insideevs.com

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