Denso, a Japanese automotive supplier, is aiming to enter the hybrid and electric vehicle market.  The supplier, whose largest shareholder is Toyota, currently supplies items such as inverters, electronic control modules, various sensors, and other electronic gadgetry for several automakers.  With long standing expertise in the electronics field the company now looks to become a leading supplier in the hybrid and electric vehicle segment with a focus on battery technology.

Toyota currently holds a 23% stake in supplier Denso and is the worldwide leader in sales of hybrid vehicles.  With Denso entering the hybrid and electric market, Toyota would have a controlling interest in a company who specializes in components needed by the automaker.  Further, more suppliers in the already crowded battery supply field would drive down costs of components.

Denso has been working on lithium-ion battery technology for the last 15 years.  Initially the company had hoped to enter the consumer electronics li-ion market, but now has decided to apply their expertise in the automotive field. 

However, all is not positive for Toyota.  If Denso moves into the automotive battery market, Toyota's joint venture with Panasonic, who supplies all of the batteries for the companies hybrid vehicles, would be met with competition from Denso.  Toyota's joint venture with Panasonic as well as a 23% stake in Denso could result in conflicts later on.

Source:  Automotive News (Login Required)