Benchmark debuts cell price forecast as US’ LFP pipeline surges

US-made lithium iron phosphate (LFP) cell prices are forecast to be 56% higher than their Chinese equivalents in 2025, according to the newBenchmark Cell Price Forecast.

Although the build out of domestic LFP cell production lines is expected close this price gap somewhat, US dependence onLFP cathode active material (CAM) importslimits its ability to close the price gap completely, as Chinese CAM issubject to tariffsand also makes production facilities ineligible for 45X production tax credits.

What is the status of LFP cell production in the US?

Envision AESC became the first battery manufacturer in North America to begin commercial scale LFP production earlier in 2025, retrofitting its legacy facility in Smyrna, Tennessee, to support the company’slocal BESScustomers, primarily Fluence Energy.

But the driving force behind the growth in US LFP gigafactories in Q2 was the EV market.

On the 14thJuly, General Motors (GM) formally revealed plans to add production lines capable of manufacturing lithium iron phosphate (LFP) batteries at its 40 GWhgigafactory joint venturewith LGES in Tennessee. GM has also committed to adding LFP production lines to its LGES JV facility in Warren, Ohio. Production of LFP will begin concurrently with nickel cobalt manganese (NCM) cell production in 2027 at its under-developmentplant with Samsung SDI, in New Carlisle, Indiana.

The shift in strategy from GM and others could address this key supply gap, and combat the nowunavoidable tariffsimposed by the Trump Administration.

How are tariffs impacting cell pricing?

From 2026, thetariffon imported Chinese cells will rise to 82.4% due to the Section 301 investigation. This will begin to make US’ LFP cells cost competitive, despite lower domestic prices in China.

As of 2025, LFP manufacturing plants in the US are relying onSouth Korean AAMandIndonesian CAM, subject to 25% and 32% reciprocal rate import tariffs respectively. There is the potential for these rates to drop with further negotiation, reducing LFP costs more.

When considering Chinese company profitability, Benchmark understands that many Chinese manufacturers capture higher margins when exporting to overseas markets, often having agreements in place with state entities to subsidise production costs at domestic facilities, meaning they can sell at or below production costs in China.

As the situation stands, LFP production in the US is unlikely to be eligible for production tax credits under 45X due to the majority of cathode active material originating from China. Currently US LFP cell prices are forecasted to remain over 40% higher than those originating in China out to 2030.

Whilst tariffs on Chinese cells will close that gap and benefit US cell manufacturers, enabling tax credit eligibility through the build out of domestic CAM production would further enhance the benefits of onshoring cell production.

Benchmark debuts cell price forecast

In order for OEMs to develop the strategies required to compete on a global scale, an understanding of future cell price trends is essential. As of Q2 2025, Benchmark Mineral Intelligence is pleased to announce the launch of itsBattery Cell Price Forecast, included as part of Benchmark’s Battery & Gigafactory Forecast subscription.

This service will provide market participants, OEMs, and investors with Benchmark’s expert battery cell price forecasts, based upon analysis that centres on regional production costs, bill of material (BoM) changes, market fundamentals, and policy developments.

The tool provides EXW price forecasts for 43 battery grades through to 2030, configured around cell technology, format, and region. The accompanying report covers wider market analyses around movements and trends in major cell chemistries and pivotal policy developments in the space.

Contact usto learn more or request a free demonstration of Benchmark’s completeBattery & Gigafactory Forecast, including price and cost tools.