Japan's Sanyo Electric said it plans to start making lithium-ion batteries for plug-in hybrid cars in 2011, taking aim at growing demand for green car batteries.

Plug-in hybrids have large batteries which can be recharged at home with an extension cord, unlike conventional gasoline-electric hybrid cars, which have batteries that are powered only when the driver hits the brake.

Sanyo, the world's largest rechargeable battery maker, has said it will start producing lithium-ion batteries for conventional hybrid cars towards the end of the year in Japan and bring its monthly capacity to 1.1 million cells in 2010.

The new lithium-ion battery production line for plug-in hybrid vehicles, which will also be located in Japan, will be capable of making 300,000-400,000 cells a month, Sanyo said.

Sanyo has not disclosed how much it plans to spend on the new line. The Osaka-based company has earmarked 80 billion yen ($883 million) in capital investment for auto-use lithium-ion batteries over eight years.

The Asahi newspaper said Sanyo is set to provide lithium-ion batteries for Toyota Motor Corp's plug-in hybrid cars, but the electronics maker declined to comment on prospective customers. - Reuters