Metal prices will determine hybrid battery type

By Anna Stablum - Analysis

LONDON (Reuters) - Three kinds of batteries can power the new generation of environmentally friendly hybrid vehicles, but the one that wins will be the one that has the best balance of price and performance.

"It will be a question of cost benefit and cost performance," General Manager Jean-Pol Wiaux, at the European Rechargeable Battery Association, said.

Lead, nickel and lithium producers all want their share in the booming battery market supplying various hybrid vehicles.

These gasoline-powered vehicles are made fuel-efficient by an electric motor whose batteries recapture power when the vehicle goes downhill or brake.

But as the nickel price has tripled, and lead has doubled during the past year, battery makers are under pressure.

"Car manufacturer always want everything, they want fabulous performance and total security -- and they would like cheap prices as well," Communications Director Jill Ledger at French battery manufacturer Saft SAFT.PA told Reuters.

The firm expected the number of hybrid vehicles in the United States and Europe to thrive, reaching 2.7 million in 2012, citing the Society of Automobile Engineers.

Hybrids represents less than 0.2 percent of all new cars and small trucks purchased between 1997 and 2006, just under a million vehicles, a report from Sanford C. Bernstein said.