LG Chem Ltd will jointly develop a lithium-ion battery system with Mitsubishi Motors Corp, the Japan's Nikkei business daily reported on Sunday.

The two firms hope to use the system for some small electric cars that will be launched by fiscal 2012 and new plug-in hybrids introduced in 2013, the paper said. An LG Chem spokesman declined to comment.

The development may lead to the first case of a Japanese automaker incorporating lithium-ion batteries made overseas, the daily added. LG Chem, South Korea's No.1 chemicals company, has already teamed up with home market giant Hyundai Motor Co, General Motors and Ford Motor Co of the U.S. on auto batteries.