Sanyo Electric Co., the world's biggest maker of rechargeable batteries, may expand a plant making next-generation batteries by 40 percent next year as demand soars for pollution-free vehicles, an official said.

The Panasonic Corp.-controlled company may produce an additional 300,000 to 400,000 cells a month in 2011 at a newly completed lithium-ion battery plant in Kasai, Hyogo Prefecture, as demand for car batteries rises to ¥2 trillion in 2015-2020, said Sanyo Vice President Shinya Tsuda.

The plant opens Oct. 22, he said.

Volkswagen AG's luxury unit Audi AG and Suzuki Motor Corp. "will be the first customers for lithium-ion cells," Sanyo's Tsuda said in an e-mail interview Thursday. The company supplies nickel-metal hydride batteries to Honda Motor Co., Ford Motor Co., and Volkswagen, Sanyo said in July.

Sanyo is speeding up development of next-generation solar batteries and new materials for lithium-ion power cells, aiming to win a bigger share of the renewable-energy market. The company plans to boost its market share to 40 percent for batteries used in electric and hybrid vehicles after investing ¥13 billion in the new Kasai facility.

The market for batteries used in cell phones, computers and cars together is ¥900 billion, with Sanyo having a 30 percent share, said Hiroyuki Okamoto, spokesman for Sanyo. While lithium-ion cells are mainly used to power laptop computers and mobile phones, electric vehicles may provide most of the growth.

Lithium-ion will displace nickel-based batteries because of difficulty in securing some metals used in production and its inability to store as much energy as lithium-ion, Tsuda said.