Sony Ups the Ante on Batteries

Posted by: Kenji Hall on August 4, 2008

What is it about Japanese companies and batteries? Today, Sony announced that it would spend $370 million to boost its output of lithium-ion batteries used in laptop computers, cameras, cellphones and other gizmos. Over the next three years, the money will go toward building new plants (Sony didn’t say how many) and expanding two facilities in Fukushima and Tochigi prefectures, northeast of Tokyo. Sony will also be jacking up production in Singapore and China.

The result: an 80% increase from its current monthly output of just under 500 million units to nearly 900 million.

This is no surprise. Batteries for laptop computers are driving the market these days, despite the rash of bad publicity two years ago when several laptops with Sony-made batteries burst into flames.

Just last week, Panasonic said it would earmark $1.1 billion for a new factory (it will initially crank out 300 million lithium-ion batteries a year when it’s completed in April 2010, and double that amount 18 months later) and another $212 million to refurbish three existing plants. Early in July, the Nikkei reported that Sanyo, the world’s No. 1 lithium-ion batter producer, would drop $500 million on new factories that are expected to be up and running next spring.

I’m betting that the three are gearing up for a bigger prize: next-generation batteries that will power gas-electric hybrid and electric-only cars.

In fact, last month, the Nikkei reported that the government is leading a consortium of Japanese tech companies and utility Tokyo Electric Power in coming up with standards for the next generation of lithium-ion batteries for cars.

For now, Sony’s investment is a drop in the bucket. Last fiscal year, Sony’s capital expenditures amounted to just over $3.1 billion (calculated at current exchange rates). Since the company will be spreading $370 million over the next three years, its battery investment will amount to just 4% of the annual figure. That’s not a whole lot given that Sony’s components business accounts for 14% of its electronics sales and 9.5% of the company’s overall sales. But you can bet you'll be seeing more announcements of this kind in the not-so-distant future.

Reader Comments

Holly Garfield

August 4, 2008 1:17 PM

Britian recently annnounced a prototype high performance all electric car (700 hp), called the Lightning, with a range of 180 miles and a charge time of 10 minutes. American company Tesla has an all electric car with a 0-60 mph (0-100 kph) time of 4 seconds, comparable to Ferraris. The Tesla has a range of over 220 miles and a 110 volt charge time of under 4 hours. The Tesla is in production this year, with 2-3 dealerships on the west coast. The Tesla base price is $109,000 according to the company's website.

Electric cars put 80% of the charging energy into the drive wheels. Gasoline cars put only about 20% of the fuel's energy into the drive wheels. Electicity comes from renewable or heavily purified fossil fuels, almost eliminating greenhouse gasses. Natural gas and coal are the primary fossil fuels.

New solar technology is producing an inkjet printable on plastic substrate solar cell. One company expecting to start selling this product is Konarka Technologies in the Boston area. Their first product is expected to be a self-charger for small electronics like a cell phone. The plastic is light and flexible, the cells work in low light and at sharp angles, and the cost per watt is under 1/2 that of today's silicon cells. That's before mass production efficiency.

There's lots of room for major battery factories. All electric cars with a useable range and mass production volumes are coming. Hybrid cars with a stronger emphasis on electirc power should be on the way, too.

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