The Economy, Trade and Industry Ministry will provide a subsidy of about 120 billion yen to Toyota Motor Corp. for its plan to domestically produce lithium-ion batteries for electric vehicles, a source close to the matter said Thursday.
With an eye to enhancing economic security, the subsidy is aimed at boosting production capacity for automotive batteries, which the ministry deems a "strategically indispensable sensitive technology."
Toyota announced last August a plan to invest about 400 billion yen in the domestic production of automotive batteries.
With the subsidy, Toyota will expand battery production at a plant of its joint venture with Panasonic Corp. in Hyogo Prefecture, as well as at other locations. The automaker will establish a system that allows for stable battery procurement and the production of complete vehicles even if the battery supply chain is disrupted by an emergency such as a natural disaster.
The ministry announced in April a 158.7 billion yen grant to Honda Motor Co. and GS Yuasa International Ltd.'s automotive lithium-ion battery business.
According to SNE Research, Chinese manufacturers control more than 50% of the global market for automotive batteries, while Japan accounts for about 10%.
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