For the first time, Toyota may be looking beyond Panasonic EV Energy Company for batteries for its hybrid vehicles. The automaker is reportedly planning to buy lithium ion batteries from Sanyo for upcoming hybrids beginning in 2011. High demand in Japan and elsewhere for its hybrid models is pushing Toyota to look beyond its joint venture that has supplied nickel metal hydride batteries for a decade.

Panasonic is currently in the midst of taking over Sanyo and is awaiting regulatory approval. Sanyo already has deals to supply lithium batteries to Volkswagen Group in the coming years. Panasonic EV Energy, meanwhile, is believed to be trailing many of its competitors in the race to develop automotive-grade lithium ion batteries. It's not known if Toyota would use the Sanyo batteries in upcoming non-plug hybrid models or in the plug-in version of the Prius.

[Source: Reuters]