GM and rivals spark race for new batteries

By Kevin Krolicki

DETROIT (Reuters) - With major automakers including General Motors GM.N touting high-profile plans for a new generation of environmentally friendly electric cars, sceptics have offered a running rebuttal: show me the battery.

GM picked Korea's LG Chem (051910.KS) to build lithium-ion batteries for its all-electric Chevy Volt, the U.S. auto maker said on Monday. It expects to build the car in Michigan and introduce it in November 2010.

Upstart rival BYD, a five-year-old Chinese company, also said it was looking to begin manufacturing operations in the United States if demand for its low-cost lithium-ion phosphate batteries takes off.

The Chinese company took the spotlight on Monday at the Detroit show to showcase its plans for a plug-in hybrid and a pure electric car for the U.S. and European markets in 2011.

Other major automakers, including Toyota Motor (7203.T) Ford Motor (F.N) and Chrysler LLC, used the Detroit show to showcase their plans for electric cars.

Taken together, analysts and green car advocates said the announcements showed the auto industry was beginning to make needed advances in battery technology to put a first wave of rechargeable electric cars like the Volt on the road.

"I'm truly delighted that GM and others are going to make these cars and that we can now start the electric car race," said Felix Kramer, a California-based advocate for electric cars and founder of CalCars.org.

Designed to run 40 miles on a single charge when it goes on sale next year, the Volt has become the centrepiece of GM's effort to reinvent itself at a time when a brutal decline in its home market has pushed it to the breaking point.