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Last Updated: Friday, 8 December 2006, 09:55 GMT
Sanyo phone batteries in recall
Sanyo sign
Sanyo is battling competition from cheaper rivals in China and Taiwan
Sanyo shares fell to a 31-year low in Tokyo after 1.3 million of its mobile phone batteries were recalled over fears they could overheat and rupture.

The recall by mobile phone operator NTT DoCoMo applies to Sanyo-made lithium ion batteries used in Mitsubishi Electric D902i phones.

Rival Sony is recalling 9.6 million laptop batteries over similar problems.

Sanyo is the world's largest producer of rechargeable batteries, but has been loss-making for the last three years.

On Friday, its shares fell 3.1% to 159 yen, their lowest level since September 1975.

Last month, Sanyo said it expected to post a 50bn yen ($430m; 224.3m) net loss in 2006/07.

The recall is the latest setback for the firm, which is struggling against high costs and strong price competition from cheaper Chinese and Taiwanese manufacturers.

In June, it scrapped plans for a joint venture to make mobile phone handsets with Finland's Nokia.

Sanyo embarked on a three-year restructuring drive last year in an effort to reduce its losses and refocus its operations.

The shake-up has resulted in a management overhaul and 14,000 job cuts.

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