Nissan puts price tag on electric car

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Published: March 30,2010

Tags: automakers, automobile industry, electric car, Nissan

YOKOHAMA, Japan — Nissan Motor Co. said its new electric car, the LEAF, will be sold for 3.76 million yen ($40,000) in Japan, less expensive than other zero-emission vehicles but still out of reach for many drivers who may also balk at its limited range.

The U.S. sale price for the LEAF was to be announced later today. Deliveries of the curvaceous, four-door hatchback will start in December and customers in Japan will be able to place orders starting April 1, Nissan said. Orders in the U.S. start April 20, and soon after that in Europe.

Under current Japanese government incentives, the LEAF would be eligible for a 770,000 yen credit, making the price 2.99 million yen in Japan, the country’s No. 3 automaker said. American buyers would also be eligible for a $7,500 tax credit.

The price makes the LEAF one of the cheapest offerings in the fledging electric car market, but analysts said it was still a bit too high to appeal to a wide swathe of buyers. The limited range of the car — 100 miles (160 kilometers) on a single charge — is also a major obstacle. Its top speed is about 140 kilometers per hour.

“It would have to be cheaper, but the main stumbling block is range,” said Christopher Richter, an auto analyst at CLSA Asia Pacific Markets in Tokyo.

“For this to be a game-changer, you’d need to have double the range, and lithium ion battery technology just can’t do that right now at an affordable price,” he said.

Still, Richter predicted the car would definitely find an audience, particularly among “people who want to be green, people who love technology and people who are status-conscious.”

“It’ll be attractive to a lot of families as a second car, particularly in the U.S. market.”

Owners of the LEAF — the name is meant to reflect the “purifying” function of leaves in nature — would need a special kit to recharge the car at 200 volts from their homes that Nissan would help set up. Normal Japanese current is 100 volts. The company has not said how much this connection set-up would cost.

A full charge takes eight hours, but a more powerful quick-charger that will be available in about 200 dealerships across Japan can recharge batteries 80 percent in under 30 minutes, Nissan said.

To help alleviate driver worries about running out of energy while on the road, Nissan will also install regular chargers at all 2,200 company dealerships in the nation. The company didn’t disclose cost of using either of these chargers.

Analysts said the LEAF may make more sense for the U.S. market than Japan or perhaps Europe because most cars in the U.S. are parked in garages attached to single-family homes, making it easy to set up recharging equipment.

But in Japan, where many families live in apartment buildings and park their cars further away, a vehicle that requires regular recharging may be a tougher sell.

So far, some 65,000 people in the U.S. — where the LEAF went on a promotional 22-city tour earlier this year — have said they are interested in the car via Nissan’s Web site. In Japan some 9,300 people have signaled an interest.

CEO Carlos Ghosn, who also heads France’s Renault, has been a vocal proponent of electric vehicles, and predicts the segment will grow to about 10 percent of global sales by 2020.

The LEAF puts Nissan in a commanding position in the young electric car market, Richter said.

“Nissan is the vanguard on this,” he said. “Really for the next few years, they are going to own the full EV (electric car) space in the same way that Toyota has owned the hybrid space for many years” with its Prius.

Production of the car will begin this fall at the company’s Oppama plant, south of Tokyo, Chief Operating Officer Toshiyuki Shiga told a news conference.

In 2012, Nissan plans to start building the vehicle at its plants in Smyrna, Tennessee, and Sunderland, England. It will also produce lithium ion batteries at those two factories, as well as at plants in France, Portugal and Japan.

“Nissan will become the first in the world to produce an electric car on a global scale,” Shiga said.

The Yokohama-based automaker played up the energy cost savings of the LEAF as well. It estimated that over six years of ownership, the electricity cost in Japan would be 86,000 yen. That compares with an estimate of 670,000 yen of gasoline cost for a similar class of vehicle over the same period, it said.

Other makers, large and small, are trying to develop viable electric vehicles amid growing consumer concerns about emissions and dependence on oil.

Mitsubishi Motors Corp. launched its electric vehicle, the i-MiEV, in Japan in June. Hours after Nissan announced the price for the LEAF, Mitsubishi said it would slash the price for the i-MiEV by 13 percent to 3.98 million yen.

So far, electric vehicles have been largely experimental, mainly used by government-linked groups. Tokyo has made reducing greenhouse gases a pillar of its policy, and has encouraged the production of electronic vehicles as a way to achieve that.

Earlier this month, Nissan, Toyota Motor Corp., Mitsubishi Motors and Fuji Heavy Industries, which makes Subaru brand cars, and a major Tokyo power company set up a group of 160 business and government organizations to promote electric vehicles by standardizing recharging machines and marketing the technology abroad.

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One Response to “Nissan puts price tag on electric car”

  1. Tech Announcements « Extractiv Says:

    [...] http://msbusiness.com/blog/2010/03/nissan-puts-price-tag-on-electric-car/ Hours after Nissan announced the price for the LEAF, Mitsubishi said it would slash the price for the i-MiEV by 13 percent to 3.98 million yen. [...]

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