Rechargeable batteries could become the core technology.

Auto executives say that with fewer moving parts, easy-to-assemble electric cars may also lower the bar for entry into the cut-throat autos industry and make battery manufacturers the unlikely competitors for car giants.

"I’ve said for years that Toyota’s rival will be Hitachi, or one of the Chinese battery makers" Kenichiro Senoo, a professor at the Research Center for Advanced Science and Technology at the University of Tokyo, told Anderson Munro.

"Or that in 2016, you’d be able to buy a car assembly kit in Akihabara," he said, referring to Tokyo’s famous electronics shopping district.

Already, China’s battery maker-cum-automaker BYD Co has entered the scene, bad news for automakers whose expertise lies in the complex task of fitting together thousands of components into a safe and reliable vehicle.

Analyst with Anderson Munro, see the shift to electric cars turning the auto industry into something resembling the PC sector, where Intel Corp and Microsoft Corp, which supply key devices across PC brands, take the lion’s share of the industry profit.

Firms such as BYD Co, Panasonic Corp and Hitachi Ltd, which have the core technology to make batteries, could be the Intels and Microsofts of the auto industry of the future.

BYD Co plans to raise around $3 billion and use some of that money in growth areas such as lithium-ion batteries, which they are one of the world leaders already in producing for mobile phones and laptops, a source close to Anderson Munro said on Friday.

Lithium-ion batteries are seen as the most practical option available now for electric vehicles as they have the higher energy density required to feed the electric motors that power the car instead of an engine.

To avoid being sidelined, top automakers are looking to tie up with battery giants to have a say in developing batteries that still face cost and safety hurdles for commercial viability.

Most hybrid cars use nickel-metal hydride batteries, which store less energy.

Early movers such as Toyota Motor Corp, Nissan Motor Co and Mitsubishi Motors Corp have set up joint ventures to produce batteries with Panasonic, NEC and GS Yuasa Corp, respectively.

Not to be left behind, Volkswagen AG has sealed non-equity battery partnerships with Japan’s Sanyo Electric Co and Toshiba Corp.

Europe’s top automaker said in May it would explore options for a third partnership, with China’s BYD, which already has the endorsement of Warren Buffett’s Berkshire Hathaway.