DETROIT – General Motors Corp. will reveal the battery supplier to its Chevrolet Volt extended-range electric vehicle at the North American International Auto Show tomorrow, Jan. 12.

Two research teams have been working concurrently on a lithium-ion battery system capable of giving the Volt 40 miles (64 km) of all-electric range, but also the durability to last 10 years.

The groups vying for the lucrative contract include Compact Power Inc., a Troy, MI-based subsidiary of Korea’s LG Chemical Ltd.; and Germany-based Continental Automotive Systems, a group working with GM and A123 Systems Inc. of Watertown, MA.

GM Vice Chairman Bob Lutz confirms the announcement, which will be led by GM Chairman and CEO Rick Wagoner and Jon Lauckner, vice president- GM Global Product Development.

GM was to reveal its choice of supplier last year, but reportedly held off so the teams could collaborate further. The auto maker has even hinted that both teams could be winners.

Compact Power was seen as an early leader, but A123 Systems said last week it applied for a piece of the available $25 billion in government loans for advanced-propulsion technology to build plant in southeast Michigan, near GM’s headquarters.

However, A123 Systems also is working with Chrysler LLC on its electric-vehicle program.

“We will announce our full intentions tomorrow, including the battery supplier,” Lutz tells journalists during a roundtable discussion at the show.

Although he declines to elaborate, Lutz outlines for Ward’s exactly what makes one supplier better than another.

“It’s…the suitability of the chemistry, experience in that type of battery, energy storage, speed to market, willingness to accept warranty responsibility and the last and probably least, price,” he says. “So we weighed a huge number of variables, as we usually do.”

The Volt is due to arrive in U.S. showrooms by the end of next year.

Meanwhile, Sen. Carl Levin (D-MI) proposes on the U.S. Senate floor today $1 billion in federal grants from the upcoming economic recovery package to U.S. companies to spur the development and manufacturing of advanced batteries, such as the Li-on battery technology.

So far, much of the expertise in battery development lies outside of the U.S.

“We cannot afford to lose the development and production of advanced batteries to other countries that are willing to offer greater financial incentives than we are,” Levin says in a statement.

“If we offer loans while other countries offer grants, we could lose the battle for green-vehicle production to other countries, not because they produce more efficiently or cheaply or produce better quality, but because they are willing to offer attractive incentives such as grants.”