Electronics giant NEC, which has a joint venture with Nissan to make lithium-ion batteries for electric vehicles, believes it can halve the cost of making the batteries in seven years while doubling their performance.

"We often discuss with Nissan that batteries should be doubling in performance and halving in costs in six to seven years from now when there will likely be the second generation of the Leaf," said NEC senior vice president Takemitsu Kunio, who is in charge of the company's battery business.

"Unless we can halve the cost by the 2017 business year or so, it would be hard for electric vehicles to become widespread."

The cost of batteries and the current range of electric vehicles are seen as the major obstacles to the adoption of EVs.

The Leaf, due for launch at the end of this year, has a maximum range of 160km (100 miles) but that could halve depending on traffic conditions, temperature and use of air conditioning.

NEC plans to quintuple electrode output capacity to 10m kw/hr by the 2012/13 financial year, when Nissan and its alliance partner Renault plan to have production capacity of 500,000 EVs.

NEC competes with established electronics makers as Hitachi, Toshiba and LG Chem as well as start-ups like Ener1 and A123 Systems in the battery market and said that it expects its battery business to generate JPY100bn (US$1.2bn) in revenue in 2012/13, or 2.5% of the company's targeted overall sales.