BANGKOK, Thailand (AP) _ Nissan CEO Carlos Ghosn said Wednesday his company is working hard to develop the next generation of smaller, lighter auto batteries _ a technology that holds promise for electric cars as well as for hybrids.

He also said Nissan and its French partner Renault SA are moving ahead with studies on a US$3,000 car for the Indian market.

As demand for ``green'' vehicles grows, automakers are racing to develop viable lithium ion batteries, which are common in gadgets such as laptops and cellphones but have yet to be fully adapted to the more rigorous demands of a car engine.

Nissan, which has fallen behind rivals such as Toyota and Honda in hybrid vehicles, recently opened a new tech centre in Japan dedicated to developing environmentally friendly technologies. Nissan Motor Co. last year introduced a hybrid vehicle with nickel-metal hydride batteries, but licenses the technology from Toyota.

Ghosn believes that Nissan's investment in green technologies will help it narrow the gap or even put it ahead of competitors down the road.

``We continue on the lithium ion battery. We think for us it's a competitive advantage,'' he told reporters during a press conference in Bangkok. ``We have a lot of technology is this area, and we think this is going to be very helpful, not only for hybrids but also for electric cars.''

While consumer interest has surged in gas-and-electric hybrid cars due to higher fuel prices and global warming, the Brazilian-born Ghosn said Nissan was serious about going one step further and introducing vehicles powered only by electricity.

``If you have an efficient battery for a hybrid, why not go all the way and go for electric cars?'' he said. ``It has zero emissions of anything.''

Electric cars have failed to catch on because they are expensive, difficult to recharge and travel limited distances. Still, several auto companies are trying to develop them for the mass market.

Ghosn said Nissan is negotiating a deal to put a fleet of electric cars in the Japanese market in co-operation with local governments, which would need to provide necessary infrastructure such as charging stations. He declined to give a timeframe or specific number, saying only ``hundreds.''

He stressed that Nissan was investing in various kinds of green technologies, not just hybrids, which has a key focus for Toyota.

``We said from the beginning, we need to develop all the technologies,'' he said. ``We can't afford to squeeze any one of them: hybrid, fuel cell, electric, diesel, biofuel. Because we still don't know how the market will react.''

Ghosn, who is also chief executive of Renault, said last week that Nissan decided to explore the viability of a US$3,000 car after an Indian rival said it was coming out with one. Tata Motors Ltd. has announced that it plans to make a 100,000-rupee (US$2,500) car in India.

``Frankly, that's something that challenges us,'' Ghosn said Wednesday. ``These people are serious, we take them seriously.''

Such an ultra-cheap car ``could have a big potential _ bigger than India,'' he said.

Renault began selling its popular Logan in India earlier this year through a joint venture with local automaker Mahindra & Mahindra, but it's priced in a range of 428,000 rupees to 547,000 rupees ($9,700 to $12,400).

Ghosn said Nissan and Renault are contacting suppliers in India and analyzing all aspects of producing the less expensive car.

Ghosn also said Mahindra & Mahindra would most likely be its local partner for such a car, although an agreement has not been finalized.

Nissan formed an alliance with Renault in 1999. Renault owns a 44 per cent stake in Nissan, which in turn holds 15 per cent of the French automaker.