Battery Replacement Program Details

[pchilds]

That 18 bar battery will still be renewed to 8 bars. :shock:

 

[Nubo]

First, I'll say that I hope Nissan is taking most of this as constructive criticism. I love my LEAF, and I want to see EVs succeed and that's why I get aggravated by missteps.

If I was to boil down the main problem, it's this:

I find it uncomfortable and inexplicable that Nissan's responses to battery issues seem to boil down to "We never considered that people would ever want to replace the battery". Or, "We never considered that owners would want to know how this plan affects them 5 years out". Really, they never thought about these things? They either have a tragic form of myopia, or... what? The excuse is.... incompetence? Really?

It's almost as if they intended the LEAF to be a disposable car. And that's what bothers me.

 

[jhm614]

I am far more pleased with paying $5,000 now if I choose and $3,000 later if I again choose.
$100 per month for as long as I want to drive the car, not happy at all.

I think the problem might be that the price isn't 5K now.

 

[LTLFTcomposite]

So are you saying that if Nissan takes back a lease and re-lease it again, they would get another gov't regulatory credit to its favor because it would be counted as another sales? So they can get 3 or 4 "sales credit" on the same car if it gets leased 3 or 4 times over its useful life? But on the other hand, if they sell the car, they only get 1 gov't sales credit and that's it, because further resale of the car is done by the owners and is out of Nissan's control?

I've always wondered why Nissan encourages leases over purchases, and if it has to do with the gov't regulatory sales credit, then it'd make a lot of sense over their recent announcement. This latest debacle of their "Steal-Your-LEAF-battery" plan is then just another ploy by Nissan to kill any chance of further LEAF purchases to push people over to LEAF leases only.

No, I was thinking just the opposite, credits are given to manufacturers for new vehicles when they are originally sold, not for vehicles that are resold, regardless of whether the cars are resold at dealers or by individuals. I don't really know but can only assume, just like the $7500, they don't hand that out every time the car changes hands.

But whether Nissan makes any money on the Leaf is irrelevant to them, I'd be willing to bet this program is a huge loser, but it doesn't matter because it allows them to keep selling their Armadas and Q50s or whatever and they make a fortune on those, the Leaf is just a cost of doing business for the ICE products. I'm also wondering if this 200k packs/year production rate from Smyrna is not being realized, and they are only able to crank out 2-3000 a month, maybe some problems ramping up, and if a bunch of people start raising their hands and say they want to buy a new pack that cuts into what they need for the production going to compliance credits.

As for the being prodded into leases, maybe they have known all along there are risks to customer sat with the car, and as long as they leased them the problem is contained. Really the people complaining about all this are the ones who bought, the ones planning to be out after three years aren't all that concerned.

 

[LTLFTcomposite]

They planned to sell 1100 of them over the course of 2 years.

OT: Any word on whether they need to bump up that number on account of the lawn mower engine settlement?

 

[edatoakrun]

="DaveinOlyWA"...how would you feel buying a replacement pack for $5,000 today knowing that in certain areas you will only have 75% of that capacity in 3 years and before paying that battery off on your 3 year payment plan at $150 a month, Nissan comes out with a battery with better chemistry that is expected to retain 90% of its capacity after 5 years in Phoenix and are selling it for $3,000?

You missed the whole point of this program.

It looks like Nissan will not sell you a new battery in five years "for $3,000" or any other price, and instead will continue to charge you $100 a month for a ~15 kWh "9 bar" battery.

And it looks like Nissan may have designed the "program" to discourage anyone else from selling you a better cheaper battery also.

="DaveinOlyWA"

...another thing to keep in mind is that 3rd party vendors only exists because there is a market. If Nissan wont sell battery packs outright, someone will

The "program" essentially give you a "teaser rate" on the monthly payment.

$100 is obviously a much "cheaper" price in the earlier months, as you are getting ~30 % more capacity from the "12 bar" battery, than you will in the later months, as your capacity decreases, and the prices of replacement batteries fall.

And the "program" also seems intended to abort competitors entry into the battery pack replacement market, since once you enter the "program" (as currently described) it will be very expensive to exit, since you presumably will have to pay for removal and delivery to Nissan of the battery in your LEAF that Nissan owns, and you will already have given away whatever value the factory battery still retained when you checked into the "program".

 

[Valdemar]

They planned to sell 1100 of them over the course of 2 years.

OT: Any word on whether they need to bump up that number on account of the lawn mower engine settlement?

No idea. All I know that there was an official comment from Honda saying that they cannot satisfy the demand after the new lease price announcement even if they really wanted to.

 

[JPWhite]

another thing to keep in mind is that 3rd party vendors only exists because there is a market. If Nissan wont sell battery packs outright, someone will

As EV's replace ICE, Jiffy Lube/Valvoline will have to figure out what to do with its staff and oil change bays/buildings. Battery swap comes to mind, and they will also vacuum the car and wash the windows.

You are right, once we drive past our bumper to bumper warranties, we don't need Nissan if someone else can step in to do the job. Only problem I see is that 2011/12 models may be too few to warrant a 3rd party engineering effort.

 

[edatoakrun]

...It's almost as if they intended the LEAF to be a disposable car. And that's what bothers me.

Actually, it just looks to me like Nissan may look at us as disposable.

Not shocked that Nissan may see us this way, but it is a little surprising to me that Nissan practices so openly, what most large corporations take great efforts to conceal.

 

[walterbays]

People keep referring to this notion the the used pack/modules has value and Nissan should be giving some trade in value for it. I'm not seeing that, nobody is going to want a used battery to make a car that was only going 15 miles go 20, people in that economic strata will be buying used kias. As for the solar storage angle Nissan isn't in that business, and I doubt they want to get into it just to unload used car parts as a free service, not to mention the whole product liability can of worms that opens.

I think there is or will be a lot of value in the old batteries even after newer improved battery technology comes to market. First life is in our cars. Second life is the best individual cells from multiple packs reassembled into remanufactured packs; Nissan is best positioned to do this. Third life is in various stationary uses, for which Nissan has no expertise. Fourth life is as a cheaper source of Lithium than mining. The Luskin School has some information on the economics of secondary uses of batteries: http://luskin.ucla.edu/ev

The problem is probably the words in red above. The technical applications, markets, and contracts are not in place for any stationary applications. Without them the cost of a battery exchange is prohibitive, but Nissan still expects to have them in place by the time a large number of batteries need to be exchanged. Perhaps if they publicly set a purchase price that would remove much of their negotiating leverage with grid operators and others in signing those contracts for stationary applications. So they announce a battery rental program to give us an upper bound on ongoing operating costs, to avoid setting a price for another year or two. They probably think of their end for a temporary rental program, when they have the full reuse program set up. And so they fail to notice that the lack of an exit to the rental program would be seen as a problem by most drivers, despite the advisory board's strong advice on the matter. I wish they'd start listening better to the advisory board.

 

[LTLFTcomposite]

I think there is or will be a lot of value in the old batteries...

Don't get me wrong I think there are a lot of great ideas in this area. But Nissan is under the gun to ramp up Infiniti to 500k units annually, things like this are really just a distraction. Plus you know how big companies work, all it takes is one lawyer saying somebody gets hurt or their property damaged by such a system and the ambulance chasers will be coming after Nissan too, and the execs will say hold on here, we aren't going to make enough on this to make it worth the risk and bother.

 

[DaveinOlyWA]

Brian, is it possible at this point you can outline the payment structure with regards to annual mileage? Or at least tell us how many annual miles will be allowed under the announced $100/month plan?

no mileage limitations, no time limitations. you can enter the lease program at 3 years and 50,000 miles or 10 years and 200,000 miles. In either case, you will get a lease battery with 12 bar capacity and most likely with a chemistry more robust than the OEM battery you replace.

Why the hell would I want to spend $100. a month on a 10 year old car ?

If I wanted a permanent car payment I would just lease the entire car for less than $200. a month and get a new battery pack every 24 months.
http://www.mynissanleaf.com/viewtopic.php?f=23&t=11245" onclick="window.open(this.href);return false;

I have no need for a car with only 9 capacity bars.

how would you suggest Nissan best help people who have purchased a LEAF and want to keep it long term? Would $5,000 for a battery with existing technology be a better deal?

well, ya it "might" be but what if a battery chemistry comes out in 18 months that proves to retain 90% capacity after 100,000 miles in very hot weather and sells for $3,000? how would you feel then?

Nissan has stated that most people will not opt in for this program because their degradation is not to the point where the batteries will lose the range that quickly. obviously people who keep their cars for 150,000 miles will be the exception but most of us wont.

So this program is really for people who drive more than usual, lives in warmer areas than usual, etc. its not a usual circumstance.

now, will more people lease because of this? sure, i guess "leasing a battery" might force more people to "lease the car instead of buying" but and i dont blame them. i am in the "lease it until they get it right" camp anyway.

http://daveinolywa.blogspot.com/2013/05/why-i-have-to-lease.html" onclick="window.open(this.href);return false;

but at the same time, did that stop me from driving electric? ohhhh Hell no! The car aint perfect and I did not expect it to be but its waaaay more than good enough. but we did not have the info to really make a good buy/lease decision and we still dont. So, considering we still dont have that info and we have the issue of taking care of early adopter owners, I think its a great compromise.

add in several tiers for wide range of driving needs and do it sooner (can Phoenicians really make it thru Summer #3?? i dont think so but i guess as long as they are below the mileage limit they are semi ok) and it would be a great solution until more options are available

 

[kubel]

Correct me if I'm wrong, but what this program does is if at any point in the future I decide that I want a new battery pack, I start paying Nissan $100/mo to rent a battery from them. Nissan takes my old pack (it's theirs now), I get a shiny new Nissan pack (also theirs). The agreement continues forever and Nissan will continue to replace the pack if it gets to 70% or less.

I see a few issues with this program:

1) Value: How are customers supposed to measure value here? We need to know the replacement cost per module.
2) Termination: If the car is wrecked, junked, sold- how does this agreement terminate? How does it transfer? What obligation does the renter have to 'pay off' or 'buy out' the pack? If I decide to sell but don't want to transfer the battery, does Nissan take back their battery and leave me with an empty shell of a car? Again, we need to know the cost to terminate or exit this rental agreement.
3) Capacity: For some of us, a battery pack that is at 70% is just as useless as a battery at 90%, so I would like to see the option to purchase a new module/pack.

Here's what I would like to see:

1) Release the current replacement cost (per module).
2) Allow customers to decide whether they want to rent a pack (under this program), or own their own pack (by simply buying one outright).
3) Have NMAC offer financing if someone decides to buy replacement modules.

If I were an owner, I would probably want the option to buy a pack (with financing if the replacement cost is outrageous).

 

[KJD]

I think there is or will be a lot of value in the old batteries...

Don't get me wrong I think there are a lot of great ideas in this area. But Nissan is under the gun to ramp up Infiniti to 500k units annually, things like this are really just a distraction. Plus you know how big companies work, all it takes is one lawyer saying somebody gets hurt or their property damaged by such a system and the ambulance chasers will be coming after Nissan too, and the execs will say hold on here, we aren't going to make enough on this to make it worth the risk and bother.

Too bad for Nissan, they are passing up on a huge market. At least one other EV company does think it is worth doing.

SolarCity is making the latest advancements in battery technologies available to you through our partnership with Tesla Motors.

http://www.solarcity.com/residential/energy-storage.aspx" onclick="window.open(this.href);return false;

 

[surfingslovak]

Plus you know how big companies work, all it takes is one lawyer saying somebody gets hurt or their property damaged by such a system and the ambulance chasers will be coming after Nissan too, and the execs will say hold on here, we aren't going to make enough on this to make it worth the risk and bother.

I would have to agree. Personally, I don't take this battery announcement as lack of goodwill, quite the opposite. That said, I do believe that it could and should have been approached more thoughtfully. This could be potentially the result of taking ill advice from someone who doesn't fully understand the role of early adopters and the paradigm shift EVs represent. While it should be clear that no company would like to hurt its market chances by deliberately offending its customer base, a single buyer of a mass-marketed product often does not have much of a voice. Although that reality might ring true, I think it's appreciated when a large corporation finds a way to give the impression of a more personalized and nuanced approach. And when it comes to new and important products, an enthusiastic customer base can help accelerate their adoption and help ensure overall success. I think that's something Apple has understood particularly well.

Too bad for Nissan, they are passing up on a huge market. At least one other EV company does think it is worth doing.

SolarCity is making the latest advancements in battery technologies available to you through our partnership with Tesla Motors.

http://www.solarcity.com/residential/energy-storage.aspx" onclick="window.open(this.href);return false;

Agreed.

 

[smkettner]

I am far more pleased with paying $5,000 now if I choose and $3,000 later if I again choose.
$100 per month for as long as I want to drive the car, not happy at all.

I think the problem might be that the price isn't 5K now.

The issue is not the number as much as a lack of a number.

The trouble is the "one size fits all" $100 payment does not allow conservative people charging to 80% once a week in a cool climate the opportunity to stretch the life of the battery compared to the 20,000 mile driver in AZ charging to 100% twice a day or multiple QC.

Many want to make these choices themselves and not give up the control to others.

If the battery cost is $20,000 installed exchange then so be it we can make our own decision.

 

[BBrockman]

Yes. I am reading all of this.

I didn't intend to inflame the issue, nor did I mean that better words in the press release would have made everyone happy with the program. It was apparent through some of the earlier questions that details should have been spelled out more clearly. That's all I meant to say with that reply.

In case Brian is reading all of this, here's my two cents.

One problem is that people who purchased their LEAFs also purchased a battery and as I read it there is no provision for receiving any value for that. Second, Brian wrote:

We have some work to do to more clearly explain the program on some levels

This somewhat inflames the issue by indicating that the problem is in the explanation rather than the program itself.

 

[mwalsh]

Wow! This thread is overwhelming me.

Did I just read something attributed to Mr. Brockman a few pages ago (and I am paraphrasing here) - $100 a month as long as you want to be a part of the program or you can buy out at any time for the residual cost of the $5000 pack purchase price. I did read that, right? It's not a product of my bleary eyed imagination?

So that's the replacement cost of the pack then - $5000? Or you can stay in as long as you want paying the $100 monthly and get pack upgrades and fresh packs whenever you want?

I really think we need a cliff notes version of the program. Because I think we're all seeing different things.

 

[smkettner]

Wow! This thread is overwhelming me.

Did I just read something attributed to Mr. Brockman a few pages ago (and I am paraphrasing here) - $100 a month as long as you want to be a part of the program or you can buy out at any time for the residual cost of the $5000 pack purchase price. I did read that, right? It's not a product of my bleary eyed imagination?

So that's the replacement cost of the pack then - $5000? Or you can stay in as long as you want paying the $100 monthly and get pack upgrades and fresh packs whenever you want?

I really think we need a cliff notes version of the program. Because I think we're all seeing different things.

I think the $5k was an option for the Smart car lease. But how much more could LEAF battery be?

 

[TomT]

I see absolutely no reason to believe that the battery will be different and/or better... None.

In either case, you will get a lease battery with 12 bar capacity and most likely with a chemistry more robust than the OEM battery you replace.