Johnson Controls and Saft plan to form a joint venture to develop, manufacture and sell nickel metal hydride and lithium ion batteries for hybrid electric vehicles (HEVs) and electric vehicles. Their agreement should be final early next year.

The firms said nickel metal hydride is the technology expected to be used in hybrid vehicles for at least the next several years, but lithium ion technology is expected to become the preferred hybrid battery technology in the future years due to its smaller size and increased power.

The new joint venture is expected to provide automakers with expanded sourcing options and production capacity for nickel metal hydride battery systems. Each company is also contributing complementary capabilities for the development and commercialization of next-generation lithium ion battery systems.

Johnson Controls recently opened a new lithium ion development laboratory in Milwaukee.