Toyota Will Buy Lithium Batteries from Sanyo

The growth of hybrid and electric cars will greatly depend on the availability of next-generation auto batteries. In a move to secure its supply of lithium ion batteries for future hybrids, Toyota will start buying batteries from Sanyo, according to Nikkei.

Currently, Toyota’s sole supplier of nickel metal hydride batteries is Panasonic EV Energy Co, its joint venture with Panasonic. Sanyo currently supplies hybrid batteries to Ford, General Motors and Honda, and signed a deal with Volkswagen to produce lithium ion batteries for vehicles to be introduced in 2010.

Toyota Prius battery pack

Nickel metal hydride battery pack in 2010 Toyota Prius.

Together, Panasonic and Sanyo currently provide the vast majority of batteries for today’s hybrids. In fact, Panasonic is awaiting regulatory approval for plans to buy a majority stake in Sanyo.

Toyota has been having trouble with meeting demand for the popular Toyota Prius because of a lack of battery supply. Toyota currently has annual Prius capacity of about 500,000 cars. Panasonic EV Energy recently announced plans to double battery production capacity to about 1 million units a year by the middle of 2010. Last year, Ford’s ability to expand production of the Escape Hybrid was limited by its supply of batteries from Sanyo.

Toyota will first use Sanyo batteries in a hybrid minivan slated to debut in Japan around 2011. Sanyo is expected to supply batteries for about at least 10,000 vehicles a year, according to Nikkei. Toyota also plans to use lithium ion batteries in a plug-in version of the Prius.

The United States is trying to catch up with Asian hybrid battery makers. Earlier this month, the US Department of Energy awarded $1.5 billion in grants to US battery makers in attempt to build a domestic manufacturing base for advanced auto batteries—to spur growth in the burgeoning hybrid and electric car industry, and to create clean tech jobs especially in Michigan.


  • Samie

    Bad move by Toyota. I understand the logic that you want a battery producer to be able to quickly scale up in production so that battery costs are reduced but long term this is dangerous & actually doesn’t cut cost further or major innovations don’t take place due to monopolistic practices. Have they not learned from mistakes made by this strategy done w/ Cosby Batteries a few years ago. Any company w/ a brain would look to other possible battery producers in a few years once Li matures that is if anyone can rival PanaSonyo in scale.

    “Panasonic is awaiting regulatory approval for plans to buy a majority stake in Sanyo” to let that go through is nuts its like AT&T buying up Verizon to control most of the cell phone market.

  • sean t

    What’s wrong with this move, Samie?
    Panasonic can’t supply enough battery, and not Lithium ion.
    Toyota wants to make plug-in cars and it desperately needs Li-ion battery, so it turns to Sanyo while waiting for Panasonic.
    Anyway, Panasonic is buying Sanyo, so why is it a bad move by Toyota? Panasonic and Toyota are very close partners, their F1 Team is called Panasonic Toyota Racing Team, so I don’t see any problem with that move. The problem may be the Japanese approves Panasonic to buy Sanyo.

  • Dom

    The one thing I don’t understand is if Sanyo had trouble meeting demand from just Ford’s Escape Hybrid, how can they now be supplying Toyota. I guess they must had seriously increased their production capacity from last year’s levels…

  • Toots McGillicutty

    What about Energizer…They keep Goin and goin and goin….

  • batterien

    I think that will sure going to hurt Panasonic’s market value as they failed to fulfill Toyota’s needs. I thought that Panasonic could have done better then this and manage the needs of Toyota.

  • tapra1

    Panasonic EV Energy recently announced plans to double battery production capacity to about 1 million units a year by the middle of 2010. Last year, Ford’s ability to Consulting Blog

  • libby trivett

    wondering where to sell used lithium battieri etc….