Nissan says all-electric Leaf will compete on price

LOS ANGELES--Nissan Motor will keep the price of its upcoming battery-powered Leaf competitive with similar-size cars and expects to make money on the vehicle despite the cost of its launch, said Chief Executive Carlos Ghosn on Friday.

The five-passenger hatchback, which is being designed to have an all-electric range of 100 miles, would cost only 1 percent to 2 percent more than traditional combustion engine vehicles in its class, he said.

"On the pricing of the vehicle it is too early to say, but there will be no surprise," Ghosn said. "We know it will be the key to the mass market."

Nissan has not disclosed pricing on the Leaf, but has said it expects the car to be the first affordable, mass-market electric car when it goes on sale in the United States, Japan, and Europe by the end of 2010.

Nissan Leaf EV photos

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Nissan has bet heavily on electric cars and expects that by 2020, 10 percent of the world car market will be for electric vehicles. It has announced a series of partnerships with utilities and government agencies to advance technology where it believes it has a chance of seizing market leadership.

The automaker said on Friday that it would cooperate with Houston-based Reliant Energy, a subsidiary of NRG Energy in developing a charging infrastructure for electric cars at homes and near office buildings.

Ghosn, who was speaking to reporters at an event outside Dodger Stadium to kick off a U.S. marketing tour for the Leaf, said Nissan would roll out the car slowly in the U.S. market to get more feedback from consumers.

The Leaf is designed to draw power from a battery-pack developed with Japan's NEC that Nissan has said can be recharged overnight on a 220-volt connection.

Nissan has taken $1.6 billion in low-cost loans from the U.S. Department of Energy to revamp a plant in Smyrna, Tenn., to make the Leaf. The first models in the U.S. market will be imported from Japan.

Nissan's rivals have pushed competing battery-powered technologies. Toyota Motor dominates the market for traditional hybrids and has floated plans for a broader range of vehicles under the Prius name.

Others, such as General Motors and Fisker Automotive, are banking on plug-in designs that rely on batteries for short drives but also include a gasoline-powered generator to recharge the battery on longer trips.

'We will make money'< br /> Ghosn, who also leads Nissan's controlling partner Renault SA, said the key to bringing down the cost of producing electric cars would be to spread development costs across up to eight vehicles for the two companies.

"We think this technology is a technology we control, but we need scale. And that is why today we are building an overall capacity between Renault and Nissan of 500,000 cars and batteries a year that we are installing between the United States, Europe, and Japan," Ghosn told reporters.

"Hopefully, we are going to move upward. Because it is not about one car, it is about four cars for Nissan and four cars for Renault."

Leasing the car's batteries is a way to bring down the upfront cost, analysts say, and Ghosn said he preferred to lease batteries because Nissan can have control over replacement as technology improves.

But while Nissan plans to lease batteries on a global scale, executives said that they are still studying whether to do so in the U.S. market.

Ghosn said the Leaf would be profitable for Nissan. By contrast, GM has said it does not expect to make money on the first sales of its plug-in Volt, expected to be priced near $40,000 when it launches in late 2010.

"We will make money out of the Leaf," Ghosn said. "We have to make money, because if we don't make money the technology is condemned."

He added: "Everything we are doing today--and that is one of the reasons we are negotiating with the government--is to make sure this technology can continue to develop. We have a reasonable return on our investments and continue to develop the technology. And the consumer has to pay a reasonable price."

Story Copyright (c) 2009 Reuters Limited. All rights reserved.

[rmva]

"Nissan would roll out the car slowly in the U.S. market to get more feedback from consumers."

Beta testers!

[subslug]

Here's some early feedback for them, Gawd! is it ugly!

Are the headlights actually bulging? lol

I could understand if they looked like crap for a reason but, what is with electric cars? Only the Tesla looks like something people would want to drive and it's price is out of sight.
I don't care how much better it is for the environment, you'd be a tool to drive this thing.

[smithjones]

@ subslug " I don't care how much better it is for the environment "

Well neither do I particularly, however..., I do like the fact that I don't have to send our dollars to other countries for their oil. I already have solar panels on the roof of our house, so it could use the system to charge.
I'm a GM V8 guy, however, I'm looking forward to purchasing one of these nissans when they come out...., of course i'll wait for a american production version.
Yeah..., it may be a little fugly, but it just needs some finessing with aftermarket accessories.

[TX_Dragon]

Way overpriced.

[pentest]

Really?

Since no price has been announced how can you say that?

[rmullen0]

Because he's clueless?

[pentest]

Why are electric and hybrid cars so ugly?

Then again, they aren't worse than the entire Dodge and Chrysler lines.

[richard993]

100 mile range is a little on the low end... Tesla motors does at least 244 miles in various road tests. But 100 miles is sufficient for my purposes for travelling every day except when going on holidays. I don't understand why they have to make the shape so ugly... the exterior has nothing to do with the technology underneath the bonnet so why make the car less appealing by giving it bug eyes and a bubbly look? maybe they don't want the car to be successful?

[commenterer]

I would never Rent a car for 3 years to be left with nothing owned at the end, for nearly the cost of car payments, or lease as they prefer to call it. And I would prefer not to rent the batteries If I were buying this car, I hope they give the option to buy at time of purchase for those who don't have a business tax right off or aren't easily sucked into such arrangements for lack of ability to operate a calculator and a budget.

[mbenedict]

If you actually operated your calculator and worked out a budget, you might find that purchasing highly depreciating assets (such as cars and batteries) isn't exactly a smart move.

Good luck "owning" an expensive piece of dead battery, and having to pay major dollars for disposal and replacement.

[commenterer]

So mbenedict you can think of no reason why Nissan may want to rent the usable life of a battery and then have the ingredients like lithium at there "disposal" in 5-7 years from now; when the demands for these metals are only going to be higher and the efficiency of recycling and reclaiming is going to make the dead battery an assett.

Of course purchasing highly depreciating assets (such as cars and batteries) isn't a financial investment but if your going to make a deal to put yourself behind the wheel for 3-5 years the more dim option is leasing one at nearly the same cost to be left owning nothing of value afterwards.

[mike_ekim]

To: commenterer
Re: renting batteries

If you wanted to sell some truly 'dead' Li batteries that were unable to hold a charge, how much would you get for them in an honest sale? I have some dead rechargable batteries in my junk drawer, as far as I know I would have to pay to dispose of them.

It is common understanding that the batteries in electric cars will be deader than a doornail in a few short years. It is true that Nissan can recycle the batteries, but the average car owner/leaser has no practical means to recover the materials on their own. The batteries will be a liability to the 'owner'. So, a lower price for leasing batteries is a win/win proposition.

Imagine if we could 'rent' tires at a reduced price! Would you refuse to do so because you wanted to 'own' the tire after you were done paying for it, when it was bald and frayed? Why 'own' a dead battery? Tires can be recycled, just like lithium batteries, and we have to pay to get rid of tires, just like we will have to pay to get rid of Li batteries.

[Joe Real]

I don' really like to lease, in general, for personal cars that I will own. But for business purposes and tax deductions as business expense, I'm fine with leasing options:

Here's one of the more reliable estimates on the price and leasing of batteries of the catfish car, i meant, the Nissan Leaf car:

http://www.allcarselectric.com/blog/1038406_nissan-leaf-to-cost-no-more-than-fully-loaded-civic-plus-the-cost-of-gas

"Leaf will be equivalent to the monthly cost of a fully loaded Honda Civic, plus the cost of its monthly fuel bill. To simplify pricing Carolin broke it down as such, "That means the purchase price (about $28,000) or comparable monthly payment for a high-end Civic plus the cost of the gasoline it would need to cover 1,200 miles (at 30 MPG and $3/gallon, about $120."

If a fully loaded Honda Civic can be leased for $319 per month. Adding in a monthly fuel cost of $120 brings the total monthly out of pocket expense to $439. Nissan will either sell or lease the Leaf and its battery at that same price...