Magna in talks with GS Yuasa on lithium ion battery production venture

Article by Christian A., on September 17, 2010

A source has said that Magna International Inc. is in discussions with Japan's GS Yuasa Corp. to make lithium ion batteries in Europe for PSA/Peugeot-Citroen SA, and probably Ford Motor Co. and BMW AG.

Plans include constructing a 40 billion yen ($466 million) factory in Spain or Austria. The source added that it’s likely the factory will begin operating in 2012 and eventually produce batteries for 50,000 cars a year.

GS Yuasa has been supplying lithium-ion batteries for Mitsubishi Motors' i-MiEV, the world's first electric car from a major carmaker, through a three-way joint venture that includes trading house Mitsubishi Corp.

A tie-up between GS Yuasa, Japan's biggest battery maker, and Canadian supplier Magna, which has a strong presence in Europe, will benefit both companies.

Both would get access to a broad customer base in a segment that will surely grow as carmakers are including electric cars in their lineup so as to meet stricter emissions and mileage regulations. The source said that the companies seek to supply lithium ion batteries to Magna customers such as Ford and BMW and other car producers in Europe.

It’s likely that the lithium ion batteries will be used for a new electric vehicle that PSA plans to produce in Spain, according to a report from the Nikkei business paper. It’s also likely that the joint venture will have GS Yuasa taking a majority stake and Magna holding a 20%-40% stake.

That Mitsubishi Corp. will join the venture is a possibility. GS Yuasa plans to expand sales as the global electric vehicle market is expected to grow amid worries about climate change. [via autonews - sub. required]

Topics: magna

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