By Paul Rachwal
Wednesday, May 28th, 2008 @ 10:59 am

On Wednesday, Volkswagen and Sanyo Electric announced a partnership to develop lithium-ion batteries, joining the Toyota/Panasonic and Matsushita, Nissan/Automotive Energy Supply and GM/A123Systems collaborations in the race to bring high-volume hybrids to market.

Sanyo holds the world’s biggest share of computer and cell phone lithium-ion batteries, and has committed to spending 80 billion yen (about $773 million) over seven years on the project. The electronics giant hopes to start producing the automotive-grade batteries as early as next year, according to Automotive News reports.

The initial run will come from a new manufacturing line at Sanyo’s existing Tokushima, Japan factory, with a dedicated new factory going online by April, 2010, capable of producing between 15,000 and 20,000 units. By 2011, Sanyo plans to begin production of another lithium-ion battery to be used in rechargeable plug-in hybrids.

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