As the carmakers around the world race to build electric cars, North America isn’t prepared in regards to mining the battery material and producing batteries.

North America doesn’t have a hearty supply base for the market.  In fact, South America provides over half of the required lithium for batteries.  In about a decade, approximately 40% of lithium will derive from China.

The key is to come up with a long-term investment that is strategic.  This sort of investment came today.

Johnson Controls-Saft made an announcement that it won a contract of two years from an advanced battery group, made up of several carmakers and battery suppliers, including the Detroit carmakers, to build lithium-ion battery systems for hybrid cars that are plug-in.

Included in the contract is an $8.2 million allotment in research money that comes from the U.S. Department of Energy.  This joint venture between Saft and Johnson Controls Inc. will try to make the technology ready commercially for mass-market plug-ins.

It is essential that the manufacturing base is developed to make batteries in North America, so that we don’t have a dependency on other countries.  After all, consumers want to save money on gas by purchasing hybrid cars with a good auto warranty.