Sanyo, VW to develop batteries for hybrids

Lithium-ion strategy comes as VW works on diesel-electric Golf

TOKYO – Sanyo and Germany’s Volkswagen AG will develop lithium-ion batteries for hybrid vehicles as global automakers race to develop more environmentally friendly technology.

Japanese electronics maker Sanyo Electric Co. said Wednesday it will invest $769 million to expand production by 2015 of such batteries, with 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, announced Wednesday, 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.

MSNBC