Jan. 14 (Bloomberg) -- China's BYD Co., the world's biggest maker of mobile-phone batteries, plans to sell hybrid cars in the U.S. as soon as 2010, using its technology to expand into the market for energy-efficient vehicles.

``We are the best in battery technologies, and I am sure we will be the best in the automobile industry as well,'' founder and Chairman Wang Chuanfu said in an interview at the North American International Auto Show in Detroit today. ``Electricity will replace gasoline,'' he added.

BYD says low-cost vehicles will enable it to compete with General Motor Corp. and Toyota Motors Corp., the world's largest automakers, which both outsold it about 1,000-to-one last year. GM, Toyota and other automakers are also adding electric and gasoline-electric hybrid models as rising oil prices and greater environmental awareness boosts demand for fuel-efficient cars.

``BYD has strength in developing batteries,'' said Yale Zhang, director of CSM Asia, which advises automakers in China. ``But it takes a lot more than batteries to sell cars.''

Detroit Show

BYD, which doesn't rank among China's top ten carmakers, is displaying four models including a hybrid sedan at the Detroit motor show. The Shenzhen, China-based company will sell a hybrid vehicle in China from the second half of this year, which may be priced $6,000 higher than gasoline-powered cars, Wang said.

The company's F3 model is priced at 59,800 yuan ($8,254), about half the price of Hyundai Motor Co.'s Accent.

BYD began making cars in 2003 after taking over Qinchuan Automobile Co. It built its 100,000th vehicle four years later, making it the quickest Chinese carmaker to reach this tally, according to the company's Web site.

BYD, Chery Automobile Co. and other Chinese automakers are targeting the U.S., the world's largest auto market, as growing competition crimps profit margins at home. About 47 companies, including foreign automakers, build cars in China, compared with a total of 17 in the U.S.

``No one would give the Chinese any territory easily in the U.S. market,'' said Mike Dunne, managing director of J.D. Power & Associates China in Shanghai. ``Competitors will respond with full force and Chinese automakers would have to fight for every inch.''

BYD plans to make cars in the U.S. eventually, Wang said, without elaboration.

China Exports

China's vehicle exports tripled in the past five years to about half a million last year. The figure may double again by 2010, according to the country's commerce ministry.

China's domestic vehicle sales have risen about fivefold over the past decade to more than 8 million a year as economic growth boosts sales. The country's vehicle ownership level is still about a third of the global average.

BYD began operating in 1995 with 20 employees, according to Wang, and doubled its profit to 1.12 billion yuan in 2006 from a year earlier. It posted sales that year of 12.9 billion yuan, the highest among Chinese automakers outside state control, according to Forbes magazine.

The company sold about 100,000 vehicles worldwide last year and aims to sell 1.5 million by 2015, according to its Web site. The carmaker rose 63 percent in Hong Kong trading in the past 12 months, twice the rate of the benchmark Hang Seng Index.

BYD plans to make cars using batteries with an iron- phosphate cathode. Such batteries are less inclined to overheat than conventional lithium-ion batteries, said K.G. Duleep, managing director of Energy & Environmental Analysis Inc. in Arlington, Virginia.

BYD also plans to debut its first all-electric vehicle, named E6, next year in China. The car can run as far as 400 kilometers on battery power, Wang said. It takes more than 10 hours to fully recharge the batteries, he added.

``We don't expect to have too many sales of E6 models as there are still no electricity recharging stations,'' Wang said.

To contact the reporter on this story: Tian Ying in Beijing on ytian@bloomberg.net

Last Updated: January 15, 2008 00:50 EST