Panasonic will construct a 50 billion yen ($412 million) Chinese factory for automotive lithium-ion batteries. The plant in the northeastern city of Dalian, Liaoning Province, will churn out rectangular-shaped batteries for electric vehicles and plug-in hybrids. It is expected to go online in 2017 via a joint venture with a Chinese partner. Panasonic already manufactures personal computer batteries in China, but this will mark its first dedicated plant for electricvehicle batteries. Annual capacity is projected at the equivalent of around 200,000 electric vehicles. The Chinese government is promoting environmentally friendly vehicles, including electric cars, as the country struggles with severe air pollution. Panasonic is the world’s biggest producer of automotive lithium-ion batteries, with a global market share of 45.7%, and is also building a U.S. facility with Tesla Motors. With the planned move in China, the Osaka-based company aims to solidify its footing in these two key markets. Demand for electric vehicles and plug-in hybrids is strong in China, helped by green-auto subsidies of up to 55,000 yuan ($8,505) per vehicle. Such domestic manufacturers as BYD and state-owned Beijing Automotive Group have been actively rolling out such autos. Foreign carmakers including Nissan Motor and Volkswagen are also stepping up Chinese production of them. Market research company Fuji Keizai forecast in the summer that China’s market for electric vehicles and plug-in hybrids would expand 650% from 2015 to 2025, reaching 650,000 units. Actual growth so far has outpaced such projections. Chinese production of electric vehicles and plug-in hybrids more than quadrupled on the year to 290,000 units for the January-November period, according to the China Association of Automobile Manufacturers. The full-year volume may top 350,000, the trade group says.