So, does Nissan make a profit from the LEAF?

Does anyone know if Nissan actually makes a profit from the sale of the LEAF? Clearly, LEAFs depreciate faster than Nissan anticipated, based on the lease residual value vs. advertised used LEAF prices.

Also, clearly, manufacturers haven't jumped into the market very quickly. If there was money to be made, I would have expected a greater selection by now. If I want to buy an EV in my state (WA) today, my only choices are a Mitsubishi, BMW, Nissan or Tesla. Given the high cost of the BMW and Tesla, and the low quality of the Mitsubishi, there really is only one choice. VW, GM, Kia and Ford are all claiming that their vehicles are on the way, but they sure aren't showing up very quickly.

One thing that helps the bottom line for Nissan is the LEAF's contribution to their corporate average fuel economy (CAFE).

I'm pretty sure we've heard Carlos Ghosn say at some point that the Leaf was becoming profitable. However, there are more things to consider than just the cost of manufacturing vs. the cost of selling the car. For one thing, it raises their entire CAFE rating. For the other thing, they get CARB credits in those states like California that require EVs. That is worth quite a bit of cash right there.

The issue of other manufacturers "jumping into the market" as you point out is more complex. Most manufacturers now have at least one plug-in offering of some kind. But without increasing the production to hundreds of thousands per year, the margins on these vehicles are always going to be low or actually negative. And most manufacturers are afraid to invest in building such a large number of such vehicles not knowing if they will sell or not. Also keep in mind that even if every manufacturer decided to jump in head-first today, we wouldn't be seeing their products showing up on the market for at least 5 years. Cars take a while to bring to market.

ALF said:

.... VW, GM, Kia and Ford are all claiming that their vehicles are on the way, but they sure aren't showing up very quickly.

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I would bet that Nissan is just starting to break even on the vehicles they are selling now. I'd bet they are quite a ways away from the Leaf program being profitable as a whole considering the amount of money that had to be invested in the development and the losses they likely took in the 1st few years of production.

I agree with your assessment that in the BEV market in WA, the affordable choices are few.

The Focus Electrics are in short supply right now due to the model year changeover shutdown, but the 1st wave of the new 2015s seems to have rolled out. It looks like the 1st batch were mostly delivered to compliance states. There are quite a few in the Portland area. Many dealers in WA will trade to get a car from Oregon brought up here. Bickford brought mine up from Oregon about this time last year.

There are a handful of used Focus Electrics around the Puget Sound right now, so either the 1st wave of lease returns are coming in, or the local dealers have tapped into some of the cars that were bought back by Ford during the Stop Safely Now fiasco

cwstnsko said:

The Focus Electrics are in short supply right now due to the model year changeover shutdown, but the 1st wave of the new 2015s seems to have rolled out. It looks like the 1st batch were mostly delivered to compliance states. There are quite a few in the Portland area. Many dealers in WA will trade to get a car from Oregon brought up here. Bickford brought mine up from Oregon about this time last year.

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Interesting! I live less than 10 miles from Bickford Ford. I went in there a few months ago, asking about the Focus Electric, and they were totally clueless, claiming that Ford had no information regarding when or if the Focus would be available in WA during 2015. I also signed up to get emailed news about the Focus Electric on the Ford website over a year ago, and have not received a single communication. At this point, Ford makes Nissan look pretty good.

According to this article from last October http://www.dailytech.com/Nissan+Still+Trying+to+Make+a+Profit+on+Leaf+EV/article36675.htm" onclick="window.open(this.href);return false; , Nissan is just starting to make a profit on the Leaf, but only if you consider the material and labor costs to build the car. Carlos Ghosn admits that they have yet to recoup "everything we have spent", i.e. their development costs.

RonDawg said:

According to this article from last October http://www.dailytech.com/Nissan+Still+Trying+to+Make+a+Profit+on+Leaf+EV/article36675.htm" onclick="window.open(this.href);return false; , Nissan is just starting to make a profit on the Leaf, but only if you consider the material and labor costs to build the car. Carlos Ghosn admits that they have yet to recoup "everything we have spent", i.e. their development costs.

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I don't think Nissan has a chance of recouping "everything they have spent" until they amortize it over more than one vehicle. If they take the second generation BEV technology and apply it to other cars, such as the Infiniti LE and the e-NV200, only then they will be able to recoup all of their investment. I do think these vehicles are coming, but Nissan is wise to wait for the next generation. Give it 2-3 more years. I would guess somewhere around the end of this decade, Nissan will be net positive with their EV program.