Nissan Motor Co. said it will set up a joint venture with a Japanese trading house for recycling of electric car batteries.

Nissan said Tuesday the joint venture with Sumitomo Corporation is expected to begin operations in late 2010 in Japan and the United States. The companies have yet to finalize details including the capitalization of the venture.

The launch is in line with a potential surge in demand for electric vehicles powered by batteries.

In August, Nissan rolled out its zero-emission vehicle, the Leaf, which will go into mass-production globally in 2012. The car uses a lithium-ion battery pack.

Nissan's Chief Executive Carlos Ghosn said Monday that global demand for electric cars will jump, forecasting such vehicles would account for 10 percent of the global auto market by 2020.

Nissan said Tuesday it was also considering a recycling business for electric car batteries in Europe with Renault SA of France, which owns a 44 percent stake in Japan's No. 3 car maker.

Sumitomo spokesman Kazuho Enaka said the venture aimed to recycle electric car batteries for energy storage for households and companies.