by STEVE HARTSOE, Associated Press Writer
Lenovo Inc. recalled about 205,000 laptop computer batteries worldwide Thursday, warning that they could overheat and cause a fire.
The battery recall was the second for the company in the past six months and comes as Lenovo, the world's No. 3 computer maker, tries to gain ground on its better-known competitors.
The latest recall includes about 100,000 batteries in the United States and another 105,000 worldwide, Lenovo spokesman Bob Page said. The recall involves batteries made by Japan's Sanyo Electric Co. and follows four reports of overheating. In one case, a user suffered minor eye irritation, the company said.
The Chinese PC maker, which has its world headquarters in Research Triangle Park, said consumers should stop using the recalled products immediately. It said the batteries can overheat if the laptop is dropped a certain way, striking the battery on a corner edge.
The advisory was made with the U.S. Consumer Product Safety Commission.
In September, IBM Corp. and Lenovo said they were seeking the recall of 526,000 rechargeable, lithium-ion Sony batteries purchased with ThinkPad computers after one of them caught fire at Los Angeles International Airport. Lenovo bought IBM's personal computer division in May 2005.
The earlier recall was part of a global recall of more than 10 million Sony-built batteries that were used in notebooks from Apple Inc., Dell Inc., Lenovo and others.
An industry analyst said the recalls shouldn't hurt the company.
"I don't think at this point it negatively affects the company given last year there was practically an industrywide recall based on the batteries," said Martin Kariithi of Technology Business Research, a New Hampshire-based group that studies the computer industry. "It's not likely to have an impact on earnings because the manufacturer pays for the costs of a recall."
Kariithi said last year's recall ate into Sony's fourth-quarter profits, and that Sanyo would suffer similarly with this latest recall.
"Sanyo is going to financially support the recall," said Lenovo spokesman Ray Gorman. "From a competitive perspective, we expect this recall to have only minimal, if any, impact."
A call seeking comment from Sanyo was not returned Thursday.
Lenovo said Thursday it sold the extended-life batteries with new ThinkPad notebook PCs or as optional or replacement batteries for ThinkPad notebook models R60, R60e, T60, T60p, Z60m, Z61e, Z61m, and Z61p. The recalled nine-cell batteries have the part number FRU P/N
92P1131 and sell for about $180.Lenovo bought IBM's personal computer division in 2005 and about 1,500 of Lenovo's 20,000 employees work in Research Triangle Park. A $150 million campus built in Morrisville is expected to open this month.
Lenovo cut 1,000 jobs worldwide last year and had an operating loss in the most recent quarter for the division that covers the U.S. and Canada. The company's chief financial officer has told analysts the situation in North America "is the cause of greatest concern."
Meanwhile, in Asia, companies such as Dell are gaining ground and sales growth for Lenovo is slowing, adding pressure on the company to increase sales in Europe and the U.S.
Lenovo has recently made high-profile sponsorship deals with the NBA, Olympic Winter Games, Carolina Hurricanes and Washington Redskins to grab consumers' attention and lead to more sales.
Another strategy includes selling ThinkPads through nearly 700 Circuit City stores. Lenovo already has deals with Best Buy and Office Depot.
Company officials say both strategies are inexpensive and effective ways promote the Lenovo brand.
Benjamin Gray, a business computer analyst with Forrester Research Inc., said Lenovo maintains a solid reputation in the U.S. and Europe and should fare well despite the recall.
"Yeah, this is certainly a difficult thing to deal with as a user and a customer," Gray said, "but it's not something that will cause customers to move away from Lenovo, absolutely not."
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