UPDATE 2-Panasonic invests $30 mln in Tesla Motors

* Panasonic $30 mln investment deepens Tesla tie on batteries

* Panasonic is world’s largest maker of lithium ion batteries

* Asian firms battle for share of new market (Rewrites, adds details, background)

TOKYO, Nov 4 (Reuters) - Panasonic Corp 6752.TPC.N has invested $30 million in U.S. electric car maker Tesla Motors Inc TSLA.O, the company said on Thursday, deepening an existing collaboration in lithium ion batteries.

Panasonic, which through its subsidiary Sanyo Electric 6764.T is the world's largest maker of lithium ion batteries, is jostling with South Korea's LG Chem 051910.KS and other rivals as the industry's focus switches to automotive uses from consumer electronics such as personal computers and mobile phones.

The market for lithium ion batteries for electric and hybrid vehicles is expected to balloon to more than 40 times its current size in the next five years and eventually to overtake the consumer battery market.

Manufacturers agree that only big players will be able to hold down prices and stay competitive.

Panasonic already supplies Tesla with standard-sized cylindrical battery cells, thousands of which are packaged to power the firm’s electric roadster sports model. The two companies have collaborated on research to develop batteries specifically for vehicles.

Toyota Motor Corp 7203.T holds a $50 million stake in Tesla.

Panasonic said in August that it was in talks with about 20 car makers about supplying lithium cells. [ID:nLDE6721HR]. (Reporting by Isabel Reynolds; Editing by Edmund Klamann)