Sony Invests $369M to Expand Lithium-Ion Battery Production

Sony Corp will invest $369 million (40 billion yen) to power up its lithium-ion battery production operations, adding new facilities and augmenting existing lines.

The infusion, which Sony said is the first phase of investment in lithium-ion batteries the company is undertaking as part of efforts to reinforce core areas of its component and semiconductor business over the next three years, will be used to construct new production facilities and to enhance existing lines at Sony's lithium-ion battery production sites in Japan, the Motomiya Technology Center and Tochigi Technology Center of Sony Energy Device Corp.

Sony said it is making the investment in response to the growing demand for lithium-ion batteries and that the new production facilities will focus on electrodes, battery cell production lines, and charge and discharge equipment, among other technologies.

Sony further reminded its expanding lithium-ion battery production in Singapore and China, and said that in total its monthly production capacity will increase from the current level of 41 million cells per month to 74 million cells in 2010.

Sony’s $369 million investment will start in its current fiscal year and continue through the second half of its fiscal year 2010. Sony’s fiscal Q1 2008 concluded in June.

Meanwhile, Matsushita Electric Industrial Co recently committed $923 million (100 billion yen) to build a plant in Osaka, Japan, that is expected to bring its cell production to about 75 million a month from its current 25 million cells per month.

Sanyo Electric Co has also reportedly announced plans to invest, promising $1.15 billion (125 billion yen) to develop its rechargeable-batteries business over the next three years. That investment is expected to increase cell output to 90 million per month from Sanyo’s current 70 million cells per month.

All three of the Japan-based companies last year suffered from loses brought on by their battery operations. Sony-made lithium-ion batteries made for laptop computers had been shown to be prone to overheating, which has triggered massive recalls worldwide from computer makers including Dell, Apple, Lenovo, Acer, and Toshiba.

Some 208,000 defective 9-cell lithium-ion batteries made by Sanyo that had been used in Lenovo's ThinkPad notebook computers were recalled in March 2007.

Meanwhile, cell phone batteries were a source of woe for Matsushita, when Nokia recalled 46 million Matsushita-made cell phone batteries last August.

Electronic News, a sister publication of EM Asia