LOS ANGELES - Sanyo Electric Co Ltd plans to ramp up investment in its battery and solar business as the world's largest maker of rechargeable batteries moves closer to being acquired by Japan's Panasonic Corp, a senior executive said in an interview on Thursday.
Sanyo's executive vice president, Mitsuru Honma, declined to give an estimate of how much money will be pumped into the business but said a humongous amount was needed to grow.
Panasonic launched a tender offer this week for shares of Sanyo at a price that was lower than Sanyo's closing price on Wednesday, but Honma called the offer a reasonable price.
The planned takeover could build a new powerhouse in hybrid car batteries, solar and other green-energy businesses.
In addition to lining up new customers for its auto batteries, Sanyo is expanding its solar business and expects to reach 600 megawatts of capacity by March 2011.
The company recently expanded operations in Mexico and opened a U.S. silicon manufacturing facility in Oregon that will reach 70 MW of capacity by April 2010.
With Sanyo making more of its own silicon and other strategies, Honma said that the company could cut the cost of its solar panels by 20 percent to 33 percent over the next year.
Earlier this year, Sanyo said it would spend $83 million to lift its solar cell capacity as it competes with its peers Q-Cells and Sharp Corp.
Honma said the company is seeing interest from customers globally, including in the United States, China, Europe and Japan for its rechargeable batteries. Sanyo announced earlier this week that it would supply Peugeot with battery systems for hybrid electric vehicles,
The company is aiming to become number one in the auto battery market, Honma said.
U.S. and many global automakers are betting that battery technology will make electric cars the transportation of the future, drawing more companies into the sector like A123 Systems Inc.
Honma dismissed A123, which recently made its initial public offering, as posing serious competition.
Honma said that he sees great opportunity in the smart grid sector where Sanyo can pull together its solar and battery technology.
The executive said that the United States will eventually surpass Japan's smart grid market, which is estimated to reach $300 billion by 2030.
(Reporting by Laura Isensee; Editing by Steve Orlofsky, Bernard Orr)