Nissan Motor plans to develop a fuel cell and introduce a working model of a fuel-cell-powered vehicle by the fiscal year beginning April 2007, according to reports.

According to CBS Marketwatch, the Nihon Keizai Shimbun reported on Saturday that Nissan plans to invest 50 billion yen to 70 billion yen ($US460 million-$644 million) to the end of the following fiscal year beginning in April 2008 to develop a fuel cell and release a fuel cell-powered vehicle.

A Nissan spokeswoman declined to comment to CBS on Monday on the report except to confirm that it plans to open a dedicated research centre in Yokohama by the end of the year to study the development of a fuel cell and fuel cell-powered vehicle.

The report said the move pits Nissan against Japanese rivals Toyota Motor and Honda in the race to create a state-of-the-art fuel cell and next-generation fuel-cell vehicles.

Nissan will develop the vehicle frame and fuel cell stack, a core component in which purified hydrogen and oxygen from the air pass through linked plates, the report said.

Nissan's plans call for a fuel cell vehicle powered by its proprietary stack to be marketed by fiscal 2007 to Japanese and US. government entities, mainly through leasing, the Nikkei said, according to CBS Marketwatch. In March, Nissan began selling cars with US-made fuel cells to Japan's Cosmo Oil and others, the report added.