06/06/2010 - Nissan committed to all-electric gamble

[sparky]

http://www.mysanantonio.com/business/local/nissan_committed_to_all-electric_gamble_95549004.html

Not a lot new here but I like Ghosn's attitude to the press. He's not couching his words; even goes so far as to essentially label hybrids as "niche products". Talk about nerve.. or is it "Ghosn-ads". (sorry)

by G. Chambers Williams - G. Chambers Williams III ...
-snip- ...
It's a big gamble, pouring even more money into an ambitious project to build electric cars that some critics say consumers might never embrace.

But Nissan President and CEO Carlos Ghosn said he remains fully committed to the project, to which Nissan and its European partner, Renault, already have pledged more than $5 billion.

Analysts say the Leaf and other Nissan/Renault electric cars might succeed if gasoline prices rise to new record levels and remain there, but otherwise they could be slow catching on with consumers. The Leaf runs completely on battery power and must be recharged by an external source — whereas hybrids also have gasoline engines to recharge the batteries and to propel the vehicles.

Although Nissan will become the first automaker to attempt to mass-market electric cars, “there is not a mass market for these vehicles yet,” said George Peterson, president of the research firm AutoPacific.
... -snip- ...
“It's kind of the wild, wild West out there right now, with manufacturers trying all kinds of things from hybrids to plug-in hybrids to pure electrics,” Peterson said. “Who knows what the right technology is going to be? But pure electrics are still hampered by a short range and a long charge time. Until those issues are resolved, a hybrid seems to make a lot more sense.”

...-snip-...
In an interview with a few automotive reporters at the Tennessee plant after the groundbreaking, Ghosn defended his plans, saying that someone needed to take the initiative and to commit to making electric cars for the masses.
Looking at the dismal future for cars fueled by petroleum — and the promise of electrics — Nissan decided, “We're going to go for it,” he said.
...-snip-...
But those reservations are “not yet sales,” Ghosn said, and it remains to be seen just how big the demand for the car will be.
“For the moment, we're encouraged,” he said. “This car is going to be a winner, and it is going to be a game-changer.”

He said he doesn't see the investment as a risk, as some critics have suggested.
“It's an opportunity,” Ghosn said. “I'm convinced this car is going to be a moneymaker. I don't know yet when that will happen.

“We're not amateurs,” he said. “We're not putting $5 billion into a product with no return.”
The decision to become the first automaker to mass-market electric cars was part business and part vanity, he suggested, saying that while the Leaf will “help the economy and the ecology of the world,” it also will be good for Nissan's image.
...snip...
“I have been skeptical how far we could go with hybrids,” he said, adding that he doesn't believe they ever will be anything more than “niche products.”
“The electric car is different,” Ghosn said. “All carmakers will come to electric cars, one way or another.”
They will be forced to because of increasing demand on the world's dwindling oil supplies, Ghosn said.
For now, though, Ghosn said he knows that electric cars aren't for everyone.

“We're not trying to answer every single question,” he said, referring to such issues as the Leaf's range of only 100 miles between battery charges. “We're not going after the customer who drives long distances.”

...-snip-...
Electric cars eventually will be cheaper to build than cars powered by gasoline, he said, because they're less complicated and have fewer parts. Work also is progressing on making the battery packs cheaper, he said.
....-snip-...
“The cost of gasoline will drive the numbers of people buying electric cars up,” he said. “But there are people who will buy no matter what the gas prices are.”
Despite the criticism he hears of the decision to mass-market electric cars, Ghosn said he remains convinced that “it makes a lot of sense.”
“Oil prices will go up,” he said. “Regulations on emissions are becoming tighter and tighter. At a certain time, we will have to have transportation with zero emissions and zero dependence on oil.”... more at http://www.mysanantonio.com/business/local/nissan_committed_to_all-electric_gamble_95549004.html

 

[evnow]

They will be forced to because of increasing demand on the world's dwindling oil supplies, Ghosn said.

I've always thought the main driver behind Ghosn's EV commitment is Peak Oil. He understands it unlike other auto execs. BTW, Lutz pushed for Volt for the same reason.

 

[MikeBoxwell]

I've read so many reports about oil supply and demand, written by all sorts of different people and organizations - from green pressure groups, government research establishments, the petroleum companies themselves, hell - even the US Army have written one.

They all say one thing really loudly and really clearly. The demand for petroleum products is growing and will become unsustainable in the next few years. A lot of reports put a date on it: 2014 and 2015 are the two most common, although oil company Petronas has said its 2010 for its own oil fields.

At that point, worldwide demand for oil will be so high that quite simply, there won't be enough to go round. The results will be increasing fuel prices and growing inflation.

Rich countries like the United States and most of Europe will be buffered to a certain extent because they'll be able to outbid poorer countries such as India. But there will come a point when even that won't help. If you're driving a gas car, its going to cost you.

2014 isn't that far away. I'd hazard a guess that most people who are buying a Nissan LEAF this fall will still have their cars in 2014. Bodes well for resale values...

 

[evnow]

Rich countries like the United States and most of Europe will be buffered to a certain extent because they'll be able to outbid poorer countries such as India. But there will come a point when even that won't help. If you're driving a gas car, its going to cost you.

Actually the opposite. India and China will and have been outbidding US & EU. US esp, has a major problem - when we pay too much for the gas we go into a recession.

See theoildrum.com for everything related ...

 

[MikeBoxwell]

At the moment India and China are outbidding the US, but when the squeeze really happens, India and China won't be able to afford to outbid the US.

Wave goodbye to cheap gasoline because those days are going to be over far sooner than most people realize. In the UK, gasoline costs around $1.90 a litre - that's $7.30 per US gallon. Expect to see those sorts of prices at the pump in a few years time. And then expect to reminisce about the days when gasoline 'only' cost $7.30 a gallon a few years later.

That is when the Nissan LEAF really starts to make a lot of sense.

Of course, I could be completely and entirely wrong - and in many ways I hope I am because the impact on both the economy in Europe and the US could be catastrophic. But all the rumblings in the industry suggest we're in for a hard time unless we significantly cut our dependence on oil.

 

[mwalsh]

"Ghosnads" ROFLOL! :lol:

 

[evnow]

At the moment India and China are outbidding the US, but when the squeeze really happens, India and China won't be able to afford to outbid the US.

US can't outbid mainly because of politics. We normally prefer to outgun rather than outbid ;-)

China & India have large state owned oil companies that can be (and are) used to maintain price stability etc. So, politically they are setup to be able to outbid US - without needing to pass on all the cost directly to consumers. In US private companies will only bid up as much as possible to be passed on to consumers. As the above graphs show, the upside is very small in US.

Ofcource, when things turn really ugly, I expect some political changes in US to ration and price control oil.

 

[mwalsh]

Ofcource, when things turn really ugly, I expect some political changes in US to ration and price control oil.

...and send our young men and women to die in (more) pointless oil wars!

 

[DaveinOlyWA]

once again, i applaud Nissan for taking the initiative in a "no brainer" move.

i dont quite remember the quote by someone commenting on the Women's movement in the 60's

but it went something like "i dont know where this is going, only that change is inevitable" now that is not it, but the gist is the same.

what Nissan has realized is that someone needs to step up and if they come out with a decent product, they will have me as a very loyal customer for a long time. Toyota was first to market a decent hybrid. because of that, i bought 3 of them and i essentially dont even look at the competition anymore. Will Nissan have this effect?? i dont know that. Toyota was and is at the top of the hybrid game. will Nissan be as successful?? i do know one thing. it would take a long time for any company to allocate any significant resources towards EV's and Nissan is well ahead of the pack on that. and its primarily American based manufacturing. at 200,000 units a year, that is a significant contribution.