U.S. Battery Makers Form Alliance to Promote Production for Next-Generation Cars

Automakers hope to use lithium ion batteries in hybrids and plug-in cars.
Automakers hope to use lithium ion batteries in hybrids and plug-in cars. (Business Wire Photo)
By Sholnn Freeman
Washington Post Staff Writer
Friday, December 19, 2008

U.S. battery manufacturers are taking steps to raise the industry's profile, a move that backers hope will speed commercialization of high-tech, American-made car batteries.

A coalition of 14 companies yesterday announced the creation of a new business alliance aimed at promoting domestic production of lithium ion batteries. Automakers hope to use the batteries in next-generation hybrids as well as plug-in electric cars.

Industry consultants say U.S. companies are losing a race to commercialize the technology to rivals in Asia and Europe. General Motors has said it might use foreign-produced batteries in the Chevrolet Volt, the plug-in scheduled for production in 2010.

The coalition -- known as the National Alliance for Advanced Transportation Battery Cell Manufacture -- is based in Chicago. The Energy Department's Argonne National Laboratory, which is located in a Chicago suburb, has also signed on to the project.

The alliance includes battery giant Johnson Controls and smaller players in the field such as ActaCell, Altair Nanotechnologies and Dontech Global.

James Greenberger, a Chicago lawyer who is leading the alliance effort, said the group would seek to develop one or more manufacturing and prototype development centers in the United States. The centers could carry a total price tag of between $1 billion and $2 billion over the next five years. The group hopes to get much of the money from the federal government.

"We think this is the most effective way that government can leverage public money to both establish lithium ion battery manufacture in the United States and revitalize the automotive industry in the long term," Greenberger said.

Alex Molinaroli, president of Johnson Controls' power solutions division, said the alliance could help promote the industry as a source of new high-tech American jobs.

"I don't think it's good enough that the American consumer is going to have a vehicle that's electrified or have hybrid capabilities," he said. "It doesn't help us if we have no capability in the U.S."

The alliance took its message to Congress yesterday, as staffers from at least four House members from Illinois took part in a conference call with the group. A staff member from the office of Sen. Richard J. Durbin (D-Ill.) also participated in the call. Greenberger said he had been working to inform aides to President-elect Barack Obama as well.

"We have been told very expressly that nothing has been endorsed, but our hope is that this is an idea that will attract a lot of support in a new administration," he said.

Battery executives and industry consultants say governments in Japan, China, South Korea and Germany are pouring hundreds of millions of dollars into production of lithium ion batteries, which have chiefly been used in cellphones, laptops and other electronics.

Greenberger said the idea to create the alliance grew from a conference held in June to investigate venture investment opportunities in the advanced battery sector. Carlos Helou, another industry consultant tied to the alliance, said smaller companies in the industry couldn't afford to build plants and are looking for ways to work together and draw on public money.

So far, it isn't clear what form the new alliance will take. Molinaroli stopped short of endorsing the group's manufacturing vision. He said Johnson Controls already has contracts to build lithium ion batteries for Mercedes S-Series cars in 2009 and the BMW 7-Series in 2010. The batteries will be built at a manufacturing facility in Nersac, France, through a joint-venture arrangement with the French-owned Saft Group.

"We've got our own plans around production," he said.

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