So far in December, we saw consolidation in Japan as Panasonic bought competitor Sanyo. This union creates a stronger competitor for batteries for consumer electronics as well as for vehicle batteries, which is expected to be the fastest growing sector.

Also this month, we had Chinese battery maker BYD roll out the world's first commercial plug-in hybrid vehicle that will use its own lithium-ion batteries. Here in Portland, the local politicos are salivating over the prospect of BYD setting up local manufacturing or distribution.

Concerns about Asian manufacturers dominating an industry so essential to the future of the American automakers prompted U.S. battery makers to join together to ask for government help of a financial nature. American industry is used to companies in cheaper labor markets mass producing technologies after an industry has been established, but having them own the market from the get-go is unsettling to many. Detroit so far has largely been looking outside the country to satisfy its EV battery craving.

The Chinese government today announced that it would provide additional money for a domestic lithium ion battery maker, though on a smaller scale than in the U.S. China BAK Battery will receive $3.1 million in grants from the Ministry of Science and Technology to continue work on electric vehicle batteries.

The $6 billion market for lithium ion batteries is growing at more than 10 percent per year, and should accelerate much more quickly when plug-in and all-electric vehicles start to be produced en masse. Even if the U.S. loses out in production, the competition should result in cheaper batteries -- and therefore plug-in hybrids -- for consumers.