U.S. Car Companies Seek Government Help in Battery Race

Fearing Asian dominance of the market to produce lithium-ion batteries for electric cars, major U.S. auto parts makers are asking federal and state governments to provide subsidies and incentives to develop the new technology. Meeting in Michigan, the parts makers said their industry needs government investment in research and development, as well as tax incentives, to help them get lithium-ion battery production off the ground. Otherwise, Japanese, Korean, and Chinese battery makers for hybrid and electric cars will dominate the market, creating what one executive labeled a foreign “cartel.” The lithium-ion batteries, which can hold a larger electrical charge and are longer-lasting than nickel-metal batteries, are used for plug-in vehicles. Asian auto suppliers posted a $42 billion profit between 2002 and 2007, while U.S. companies lost $10 billion over the same period. The U.S. government has committed to spending $30 million over the next three years on plug-in projects planned by GM, Chrysler, and Ford.