UPDATE 1-Evonik, Daimler to make batteries for electric cars

Mon Dec 15, 2008 7:17am EST

* Partners form alliance for lithium-ion batteries

* Daimler to have 90 percent stake in venture

* Daimler to also take stake in Evonik unit

(Adds details, background)

DUESSELDORF, Germany, Dec 15 (Reuters) - German industrial conglomerate Evonik [RUHR.UL] and carmaker Daimler (DAIGn.DE) have joined forces to develop and build advanced batteries for electric cars, the partners said on Monday.

Daimler, which is also the world's biggest truckmaker, will hold 90 percent of a joint venture for lithium-ion batteries. Daimler will also acquire this month nearly half of Evonik unit Li-Tec as part of the deal.

Daimler plans to use the batteries in electric cars and is counting on using them soon in the serial production of cars and trucks. Sales to third parties are also planned, a statement said.

With demand for clean and efficient engines rising in the automotive world, analysts think lithium-ion batteries could enjoy a market worth over 10 billion euros ($13.5 billion) in the next decade.

Li-Tec batteries will power electric versions of Daimler's Mercedes-Benz and Smart cars from 2010, Evonik chief Werner Mueller said. The number of staff working on the technology should over time surpass 1,000 from just over 100 now.

(Reporting by Matthias Inverardi, Writing by Michael Shields)

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