Battery recycling market seen hitting $77B by 2035

Battery materials recycling is set for rapid growth as EV adoption, regulation and supply-chain pressure push more spent batteries into recovery streams. Europe’s recycled-content rules and new recycling capacity in North America and Asia-Pacific are helping drive a market expected to reach $77.07 billion by 2035.

Why it matters: - Battery recycling is becoming a critical part of the electric-vehicle supply chain as automakers and governments push to secure lithium, cobalt, nickel and other materials. - The market is projected to rise from $32.15 billion in 2026 to $77.07 billion by 2035, a 10.2% CAGR. - Europe’s battery rules will require new batteries sold there to contain recycled materials, raising demand for recovery capacity and recycled feedstock.

What happened: - The battery materials recycling market reached $29.30 billion in 2025. - By 2031, new batteries supplied in Europe must use at least 16% recycled cobalt, 6% recycled lithium and 6% recycled nickel under the EU Battery Regulation. - By 2035, Europe’s regulation will require new batteries to include significant recycled content across lithium, cobalt, nickel and lead. - A sample report is available through More information. - The full market report is available through the company's announcement.

The details: - Battery materials recycling recovers metals and materials from spent lithium-ion, nickel-metal hydride, lead-acid and nickel-cadmium batteries. - Core recovery methods include pyrometallurgy, hydrometallurgy and direct recycling. - Recycled output includes lithium, cobalt, nickel, manganese, graphite, copper and aluminum. - The market is being driven by rising EV and electronics battery waste, supply risks for critical metals and environmental rules that require battery collection and recycling. - Direct recycling is gaining attention because it can preserve cathode structure and improve recovery rates. - Hydrometallurgical methods are improving recovery rates and material purity through better leaching and solvent extraction. - Robotic disassembly and automated sorting are lowering labor costs and improving efficiency. - Regional recycling capacity is expanding to cut transport costs and strengthen supply security. - Digital tracking systems for battery lifecycle management and traceability are gaining momentum. - The market segments include battery type, recycling process, source, recovered material and region. - Lithium-ion recycling is the fastest-growing battery-type segment. - Lead-acid recycling remains a mature, high-recovery market. - Electric vehicle batteries are the largest and fastest-growing source of feedstock. - Asia-Pacific is the largest regional market. - Europe is the fastest-growing regional market.

Between the lines: - Recycling is shifting from a waste-management business to a strategic materials business. - The economics are improving as EV volumes rise and more batteries reach end of life, but the industry still faces high capital costs and feedstock variability. - Closed-loop systems between recyclers and battery makers are likely to become more important as regulations tighten and supply chains localize. - The strongest near-term advantage appears to be in regions with both heavy battery production and clear policy support.

What's next: - Redwood Materials expanded its Nevada facility in December 2025, doubling processing capacity for EV demand and adding recovery capabilities for lithium, cobalt and nickel. - Umicore signed a long-term supply agreement with a major European automaker in November 2025 for recycled battery materials. - The European Commission approved funding in October 2025 for a multinational recycling infrastructure project across five European countries. - North American capacity is expected to keep growing under Inflation Reduction Act incentives, DOE funding and domestic supply-chain priorities. - More recycling investment is likely as government mandates increase collection targets and recycled-content requirements.

The bottom line: - Battery materials recycling is moving from niche infrastructure to a core enabler of the EV economy.