Daimler has formed a strategic alliance to develop and manufacture lithium-ion batteries for cars and trucks.

The joint venture is with Düsseldorf based Evonik Industries. At the same time Daimler has acquired a 49.9% stake in Evonik Group subsidiary, Li-Tec Vermögensverwaltung (Li-Tec). The companies say they hope to attract a third investor with electric and electronic systems integration expertise. In addition they plan to establish a joint venture to develop and produce battery systems for automotive applications. Daimler will hold 90% of this joint venture and Evonik 10%.

Evonik has invested around EUR80m in lithium-ion battery development. Its CEO, Werner Müller, said: “Evonik is the only company that can actually bring about commercial series production of battery cells of this kind.”

Daimler has also invested heavily in lithium-ion technology development, and registered around 230 patents in the sector, said chairman Dieter Zetsche.

Evonik claims to be a leader in lithium-ion battery development.  “We have the universal electric drive – suitable for everyday use, safe, affordable”, said CEO Müller.

Li-Tec cells feature a ceramic separator, which the company said makes them most suitable for electric vehicles. The flat cell features a high energy density combined with compact dimensions and outstanding safety.

The German government wants to see at least 1m electric vehicles in use by 2020. A pure electric Smart car is planned for 2009, followed by electric versions of the Mercedes A- and B-Class in 2010.

Daimler also has a cooperation with Continental for batteries for hybrid vehicles. A hybrid version of the S-Class will be launched next year with a lithium-ion battery developed with Continental using cells from the French supplier Saft. This is a mild hybrid with stop-start and regenerative braking.