TOKYO May 14th, 2002 - NEC Corporation (NEC) and Fuji Heavy Industries Ltd. (FHI) today signed an agreement to form a new joint venture company (NEC Lamilion Energy, Ltd.) to advance the development of a manganese lithium-ion type rechargeable battery for automobiles.

�@NEC Lamilion Energy, Ltd. is scheduled to be established on May 20, 2002 with an initial workforce of 21 employees, 12 transferring from NEC and 9 from FHI. Paid-in capital of the new joint venture company is expected to be 490 million yen, with 51% contributed by NEC and 49% by FHI.

�@By integrating NEC's laminate type manganese lithium-ion cell technology with FHI's battery pack technology, the new company will challenge to develop a rechargeable battery that holds the competitive power of being the global de facto standard. NEC Lamilion Energy, Ltd. plans to supply the test battery to all domestic and international automobile manufacturers for industry evaluation. The company expects to prove actual performance and to determine scheme of production within 3 years.

�@To lessen the impact of the automobile on the global environment reductions in fuel consumption and exhaust gas are seen as imperative, and to achieve this, the introduction of an electric motor drive system in addition to the current internal-combustion engine is under examination. Automobile manufacturers are currently focusing their research and development power on advancing the hybrid automobile (a vehicle powered by the combination of a gasoline engine and an electric motor), the electric automobile, and automobiles driven by fuel cell. To advance the development of these automobiles, the major challenge is the development of rechargeable battery technology. More exactly, a thinner, lighter, more compact battery, with higher performance and at a more competitive price is required to raise the performance of current vehicles.
�@Additionally, in developed nations, hybrid automobile development is increasing, and full-scale production is expected in the near future with substantial market growth forecast.

�@NEC has already developed and is producing a high-security manganese lithium-ion cell with laminate packaging technology for watches and mobile terminals. Laminate manganese lithium-ion battery has many advantages over the currently used nickel metal hydride battery such as higher power density, smaller volume, lighter weight and reduced heat generation. NEC believes that this battery technology coupled with FHI's automotive battery pack technology will complete a battery pack that can be applied as the new power source for the automobile. To achieve this goal as quickly as possible, NEC and FHI have signed today's agreement to establish NEC Lamilion Energy, Ltd.

�@FHI possesses balance control technology (*see note) that converge with high accuracy and eliminate voltage imbalance between the cells caused by repetitive battery charging and discharge, as well as battery diagnostic circuit technology as its core technologies. By adopting these core technologies to the battery pack, the following improvements have been achieved: balance control of arbitrary voltages that until now has only been possible with a fully charged battery, battery pack downsizing as well as the guarantee of long operation life and reduced maintenance cost. FHI decided to establish NEC Lamilion Energy, Ltd. with NEC because it believes that the technology integration with NEC's laminate cell will enable the high-level development of a battery pack for automobiles.

* joint development with Nagano Japan Radio Co., Ltd.

�@NEC Lamilion Energy, Ltd. plans to proactively expand activities to achieve a rechargeable battery for the automobiles, which has competitive power internationally.

�@Please refer to the attachment for an outline of NEC Lamilion Energy, Ltd.

About Fuji Heavy Industries Ltd.
Fuji Heavy Industries Ltd. (FHI) is one of Japan's leading industrial manufacturers, best known for distributing automobiles under the Subaru brand. The Company has a long history of technological expertise dating back to its days as an aircraft manufacturer. FHI is recognized internationally for its all-wheel drive (AWD) and horizontally-opposed engine technologies as well as its sophisticated, small-size continuously variable transmission (CVT).
FHI's corporate philosophy is to achieve a perfect balance between society and its own individuality as a manufacturer. Throughout the fields of automotive engineering, aerospace, industrial products, ecology and transport systems, and bus manufacturing and prefabricated housing, the Company strives to promote full-scale global environmental preservation through the development of distinctive products under stringent safety standards. FHI will continue with these endeavors in the pursuit of its commitment to supply products that please the customer. In addition, the Company focuses on contributing to the prosperity of society.
For additional information about FHI, please visit our web site at http://www.fhi.co.jp .

About NEC Corporation
NEC Corporation (NASDAQ: NIPNY) (FTSE: 6701q.1) is one of the world's leading providers of Internet, broadband network and enterprise business solutions dedicated to meeting the specialized needs of its diverse and global base of customers. Ranked as one of the world's top patent-producing companies, NEC delivers tailored solutions in the key fields of computer, networking and electron devices, through its three market-focused, in-house companies: NEC Solutions, NEC Networks and NEC Electron Devices. NEC Corporation employs more than 140,000 people worldwide and had net sales of approximately $39 billion in the fiscal year ended March 2002. For additional information, please visit the NEC home page at: http://www.nec.com.