Johnson Controls Inc is expanding its production of car starter batteries in China, planning to build three or four plants new plants that will lift production to 30 million batteries per year by 2015.
Johnson Controls, a diversified manufacturer of building controls as well as auto interiors, seating and batteries for hybrid vehicles, said on Thursday that China is the fastest growing battery market in the world.
The company already has one plant in China and is building a second plant. Other plants could come on line one-per year, Alex Molinaroli, president of Johnson Controls' power solutions unit, said at an analyst event at its Milwaukee headquarters.
Molinaroli also said there is now more industry capacity being added to produce advanced batteries for hybrid and fully electric vehicles than there is current demand and a shakeout is likely within years.
"There is more capacity going in today than there are customers, that is a particularly North American phenomenon, but it is happening around the world," Molinaroli said. "It is logical to assume there will be a shakeout in this industry over the next several years."
The company said the launch of production of lithium ion battery packs and cells for electrified vehicles was on track in Holland, Michigan. Johnson Controls plans to build battery packs in 2010 and cells a year from now.
Batteries for electric vehicles comprise up to 80 percent of the total cost of the powertrain in electric vehicles and the cost of the battery is the main inhibitor of wide range adoption, Molinaroli said.
"Our own plans talk about 50 percent cost reductions by 2015," he said. "We have much more aggressive targets by the end of 2020."
