Sanyo, VW join to develop lithium-ion batteries

BEIJING, May 29 (Xinhuanet) -- Japanese electronics maker Sanyo Electric Co. said Wednesday it will invest 769 million U.S. dollars in a venture with Germany's Volkswagen AG to develop lithium-ion batteries for hybrid vehicles.

Sanyo plans to start mass producing them in a Japanese plant by next year, making 15,000 to 20,000 batteries a year.

The deal with Volkswagen follows a 2006 agreement where Sanyo and Volkswagen agreed to work together in nickel metal hydride batteries, now used in most gas-electric hybrids like Toyota's Prius.

"Our focus in future will be directed more strongly at making electrically powered automobiles alongside ones driven by more efficient combustion engines," Volkswagen Chief Executive Martin Winterkorn said in Germany. "This cooperation is an important step for us."

Many major automakers ─ including General Motors Corp. as well as Nissan Motor Co. ─ are rushing to perfect the technology for hybrids, electric vehicles and other "green" cars. As gas prices soar, such cars are becoming increasingly attractive to consumers.

Sanyo already provides nickel metal hydride batteries for Ford Motor Co., which makes the Escape hybrid, and Honda Motor Co., which makes the Civic hybrid.

Lithium-ion batteries, now widely used in laptops and other gadgets, are more powerful and can be smaller than nickel metal hydride batteries, promising potential to power future ecological cars. Volkswagen said it hopes to use lithium-ion batteries by 2010.

(Agencies)