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Nissan CEO On Leaf Sales: Take The Long View, It Will Happen

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Ryan Reynolds and Ryan Hall in an ad for the 2012 Nissan Leaf

Ryan Reynolds and Ryan Hall in an ad for the 2012 Nissan Leaf

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It's the kind of question that makes every CEO roll his eyes.

In effect, it translated to: Your sales of one model last month were lousy, so is that car a failure in the market?

But if the model is the Nissan Leaf, the first battery electric vehicle sold in volume in the U.S. (and around the world), the question takes on added resonance.

It referred to last month's U.S. sales of plug-in cars. Nissan sold 579 Leafs, while Chevrolet sold a whopping 2,289 Volts. That put total Volt sales ahead of Leaf sales for the first time since the two cars went on sale in December 2010.

At this morning's New York Auto Show keynote, Nissan CEO Carlos Ghosn effectively rebuked the questioner.

"Don't take one or two months' sales results in one or two markets," he said, "to make conclusions on this important segment of the market."

Ghosn reaffirmed his prediction that plug-in cars would be 10 percent of the global vehicle market by 2020.

He did, however, add a new qualification: "...in the markets where those cars are available."

MORE DETAIL: Electric Cars ARE Coming, But It Will Be Slow: Why Is This So Hard To Grasp?

He acknowledged that global Leaf sales--roughly 20,000 globally in 2011, and 27,000 as of the end of last month--were lower than the company had predicted before the car launched.

He pointed, however, to both the March earthquake and tsunami that severely disrupted the Japanese auto industry for several months last year, and what he called a "man-made disaster."

That would be the yen-dollar exchange rate, which has fallen from 110 yen to the dollar to 76 yen--making cars built in Japan far more expensive in the U.S.

Carlos Ghosn

Carlos Ghosn

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Ghosn said Leaf sales will soar once U.S. production of the cars begins in Smyrna, Tennessee. He said that would happen "this summer," though a Nissan representative confirmed that battery production starts in September and Job One for U.S.-built 2013 Nissan Leaf models is scheduled for this December.

That "localization" will let Nissan reduce Leaf costs considerably, Ghosn said, though he gave no details on possible price cuts for the 2013 models that will roll off the lines in Tennessee.

He noted proudly that Nissan has had "no quality problems" with the Leafs sold in the U.S., Japan, and Europe, "which was our Number One goal."

And he predicted that as oil prices to continue to rise with global economic recovery, further driving up gasoline cost, environmental reasons won't be the only ones driving buyers toward Leafs.

"It will be the economics too," Ghosn said, "that get people to use more electricity as fuel."

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Comments (30)
  1. Is that an acknowledgement that US$35,000 is not the right price point for this vehicle and that they will be willing to offer it at a much lower price point?
     
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  2. @John. I bet many people are feeling a bit of range anxiety when considering the Nissan Leaf. I heard that actual range results were about 65 to 73 miles max depending on how you drive it and at what speed. The Volt has no range anxiety since the gasoline engine kicks in when the battery is depleted and has more conventional styling as well. The Volt also gets about 37mpg in gas only mode at highway speed after the battery is depleted. I would like to get a Tesla Model S when they come out but I know that it will be expensive so I am most likely going to wait until Tesla comes out with their $30,000 Bluestar after 2015. Tesla could forever change how people view an EV if the Model S is as good as they say it is. I am optimistic about it.
     
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  3. Too little range for too much money. You can buy a fully Loaded Toyota Prius c for less money and although it gets only 11 miles in EV only it still get decent gas milage. Super high gas prices will spark demand some but poor people don't buy EV's so Maybe we need to take our Paid for 4 door Honda or Hydundia to Gadget from revenge of the electric car and have him electrify it for $15,000 for 120 miles range. That would be far more cost effective than what Nissan is offering.
     
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  4. Perhaps you meant "Plug-in-Prius" rather than "Prius C".
     
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  5. While I appreciate the feedback on the range concern, for me, the price is more of a concern. The 73 mile range would be fine for me.
     
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  6. Not true. As a LEAF owner/driver with 15,000 miles on my car over a one year period, I can tell you that the maximum range is not 65-73 miles. I would say that this is the minimum range assuming freeway driving and heater use. I have personally driven my LEAF 107 miles on a single charge. However, my 99% percent driving scenario is driving about 50 miles over the course of a day, returning to my garage, plugging the car in and then returning the next morning to a full tank. I find the LEAF to be the perfect car for a garage with 2 or more cars. My other car is a gas powered sedan that my wife and I drove less than 2,000 miles last year. The LEAF, purchased as our second car has become our primary vehicle. We both love it.
     
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  7. That's awesome I never hear of anyone doing 107 miles in a Leaf. Were you driving at 35 mph or so? I have a Hyundia Elantra and I would be interested in an Ev but I drive about 40 miles one way each and every day and I have a cabin 57 miles away and family 60 miles away. Until there are 150+ mile range EV's out there I will be holding off on a purchase. The Tesla Model S is tempting though since I seldom drive more than 160 miles round trip in a day. Maybe when charging infrastructure is in place like parking spaces at hotels with 220 volt charging then range will not matter as much. Although it would suck to have to wait 45 minutes to an hour to top off your battery so you can drive home every day after a long day at work.
     
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  8. Sounds like a Leaf would work well for you. Your 40 mile trip to work could easily be handled by a 110 charge at work (if you work 8 hours). Assuming your cabin has power, your good for an overnight charge there, and then just chat to your family, and stay through dinner to get charged. The Ford Focus EV would also work, as you could install a charger at your family and cabin and be fully charged in 3.5 hours, as it and the newer Leaf have quicker 6.6kwh chargers
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  9. Whoever asked that question was just looking for an easy headline. Of course you can't judge a car's past, present, and future sales success based on one month alone.
     
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  10. $37,000 in isolation is expensive when you consider that you can get a Volt for just a few thousand more, but it's not expensive when you consider that Ford priced the Focus Electric at $40K. The Ford should be close to $3K more expensive than the LEAF, so they are priced correctly relative to each other, but the Volt is so much better that a $10K difference is justified there. Also compare the equipment/options...
     
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  11. When comparing an EV to an ICE, the cost of fuel and maintenance should be included. Over the 8 year warranty term of a Leaf, an ICE owner would burn around $16,000-$20,000. Maintenance costs would be higher as well with an ICE.

    So, the question is what would the cost of a battery pack replacement be in eight years? Most likely around $6,000 or so. That means EV prices of today should have at least $10,000 deducted from their true cost of ownership vs. ICE cars. This assumes gas doesn't go beyond $4.00 a gallon in the next 8 years. It will.
     
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  12. This goes a long way in explaining the large price hike in only the 2nd yeast of production.

    Now this announcement will also cause fence sitters to wait for a better price since many areas won't see deliveries until summer. Why not wait 4-6 months if you can save a few thousand?
     
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  13. David, I can wait five or six years for a $20,000.00 savings, but do the automakers really want people to wait for a better price when there is really no good reason for those EV's to cost that much. The Leaf and the Focus shouldn't be over $25,000.00. It takes a lot less to make an EV than it does an ICE, and I don't think an automaker should guess how much you are going to save over 10 years and then add that much onto the price of the vehicle; that is sheep-wool robbery. The size and looks of a Leaf would indicate a price tag of a little over $15,000.00 to $18,000.00, depending on the extras.
     
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  14. There is a good, or at least real reason why the Leaf, Focus, iMiev, Tesla S cost what they do--the battery pack. These Li-Ion packs cost over $10K, significantly more for Teslas. It all comes down to volume, ICE vehicles are made in huge quantities so economy of scale is built in. EV's have battery packs that are still very expensive, they will go down with tech advances AND sales volume.

    Also, a Leaf has features not found in most $15K cars; rear camera, GPS, sat radio, steering wheel control of Bluetooth connectivity, CarWings communication and ride quality and drive train smoothness in a different league.

    If I had waited 5 years to buy an EV, I would have lost $12.5K in government incentives and spent a minimum of $10K on gas.
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  15. What makes you the expert on cost of construction?
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  16. "TrueCar estimates the price of a typical car or light truck reached a record high of $30,748 in March, up nearly $2,000, or 7%, from a year earlier."

    Makes a $37-40K EV seem like a bargain considering the cost of gas and the lower maintenance. $50 per month in electricity should keep an EV going just fine.
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  17. Nissan is the company to watch! I think the magic number for price is $25,000 for the early majority to start to enter. When the Leaf and batteries start production in TN, I suspect that the Leaf will drop under the $25,000 level and given the weak US dollar, Nissan could drop the price 20% or below $20,000. Nissan will probably play safe and to use US taxpayer money and keep the car competitively & profitably priced. It will be interesting to watch. Nobody else has this card up their sleeve!
     
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  18. I to, have gotten close to 100 miles on a charge and that was on a 65mph freeway (not going 35mph)! From cave Creek, AZ to Avondale, AZ and back.
     
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  19. The range completely depends on how you drive and whether you're using ac or heat. I reliably get 90 miles range if I keep it at 65 mph or less on the freeway with no heat or ac. But I only watch it if I know I have to drive a long way - otherwise I buzz along like I always did. All cars are affected exponentially by wind resistance especially over 60 mph, but with the Leaf you get instant feedback. I've already saved over $2000 in gas in less than a year, when accounting for my electric bill, so I'm not regretting the purchase at all. It's a fun effortless car to drive!
     
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  20. Don't forget to add in those $35 every three months on oil changes.
     
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  21. So why does the media continue to fabricate this competition between the Leaf and the Volt? They are different cars for different purposes and lifestyles, and both hold a valuable place. It's getting irritating that even green car is propagating it.
     
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  22. I see your point.
    But I am not sure if this is so much because it is viewed as a competition. Sales of EVs are so low, we are all desperate to have some sort of benchmark for how sales are progressing.

    One simple benchmark is how are EVs are doing compared to each other. This is not because we think one is going to win and one is going to lose. It is because it gives us something to compare. Comparing EV sales to ICE sales or even hybrid sales makes them look like failures, but it is just not the right benchmark.

    A second benchmark is comparing EVs sales to OEM predicted sales. But this seems like a fairly arbitrary number too.

    So if you have a third benchmark, let us know.
     
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  23. Would seem that EV to comparable size and outfitted ICE would be the true, but depressing test.
     
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  24. If I never went farther than 40 miles and charged my battery everyday in my volt, how long would it take before my gas generator went bad?
     
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  25. About the same amount of time it would take for the gasoline engine in a regular car to go bad, but most likely much longer, since it gets used much less.

    The 1.4-liter gasoline engine that runs the Volt's generator is a simpler (non-turbocharged) version of the 1.4-liter turbo four used in hundreds of thousands of Chevy Cruze models. It's hardly esoteric technology, and should last as long as/longer than any other gasoline engine.
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  26. You may not know this, but the Volt's gasoline engine has what's called a "maintenance mode"--if it hasn't switched on in several weeks, it asks the owner for permission to turn on to run all the systems for a few minutes, circulate the fluids, and generally keep itself in good running condition. In other words, Chevy anticipated the answer to your concern.
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  27. I've read all those posts below and most of you have very good comments or questions below. A few of you are just clueless or irrational when regarding the Leaf or EVs in general. Let me to attempt to correct a few items:

    1) Leaf/EV range
    This is the number one area where the Leaf needs to improve to greatly improve sales volume. Briggs may be able to commute, go to his cabin, etc. with the range of the current Leaf but he, like I, really need/want at least a range of 150 miles before we seriously consider an EV. Nissan has claimed a new battery technology that will do this for their EVs. Hopefully it will be in the Leaf by MY 2014.
     
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  28. 2) Leaf/EV costs
    Nissan raised the 2012 Leaf purchase price because of adding more features as standard...not price gouging. Look to consumerguide to see differences. And most of the "green" states have some type of rebate or financial incentive to buy an EV...along withe federal tax credit. So the actual purchase price is about mid or high 20's.
    --- Apparently many of you don't do budgeting. The costs to operate the Leaf will be about 1/3 or even less than other comparable ice vehicles so you "payback" point could be as little as two years depending how much you drive, cost of electricity, etc. The Leaf is very sound ECONOMIC decision let alone being a greenie, a patriot for improving our energy security, etc.
     
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  29. 3) Leaf, Telsa S, and probably Focus EV are just very good cars
    Get in one and drive it. Sure there's not tons of power in the Leaf or Focus but there is enough pep. I've driven these cars and there are all better cars then their ice competition. Two big reasons are cause they are quiet and they handle much better due to batteries being situated lower than conventional engines.

    -- So, as soon as the Leaf or Focus, probably the Leaf, attain that 150+ mile range, I'm in and probably many individuals, businesses, governments, etc. will be too. NLT 2014 hopefully. The purchase price will probably stay in the mid 30's btw.
     
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  30. So okay, car manufacturers are FINALLY making electric cars; and long overdue, it's true. However, what boggles my mind, is why no one converting the existing gas cars into electric cars? This is a completely untapped market and would make money for whoever taps into it. It will also save the consumer a lot of money as well. Not to mention the fact, where are all of those gas vehicles to go...some junk yard? Then it's no longer a green concept is it? Seriously guys...who's going to kick off the most obvious green business in the automobile market? If I had the money to invest in it, you can be sure I would have done it by now.
     
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