Nissan launches Leaf, bets big on electric vehicles

YOKOHAMA, Japan Fri Dec 3, 2010 4:35am EST

Nissan Motor's all-electric vehicle, the Leaf, is seen on the production line at Oppama plant in Yokosuka, south of Tokyo, in this handout photo released by Nissan on October 22, 2010. Over the past few years, Nissan executive Eiji Makino has met with leaders around the globe pursuing an unconventional strategy: lining up support for the Leaf before it was even on the road. Electric cars need to recharge around town and a growing number of governments, seeking to reduce oil dependence and clean up the environment, have agreed to subsidise that kind of infrastructure. REUTERS/Nissan Motor Co/Handout THIS IMAGE HAS BEEN SUPPLIED BY A THIRD PARTY. IT IS DISTRIBUTED, EXACTLY AS RECEIVED BY REUTERS, AS A SERVICE TO CLIENTS

Nissan Motor's all-electric vehicle, the Leaf, is seen on the production line at Oppama plant in Yokosuka, south of Tokyo, in this handout photo released by Nissan on October 22, 2010. Over the past few years, Nissan executive Eiji Makino has met with leaders around the globe pursuing an unconventional strategy: lining up support for the Leaf before it was even on the road. Electric cars need to recharge around town and a growing number of governments, seeking to reduce oil dependence and clean up the environment, have agreed to subsidise that kind of infrastructure.

Credit: Reuters/Nissan Motor Co/Handout THIS IMAGE HAS BEEN SUPPLIED BY A THIRD PARTY. IT IS DISTRIBUTED, EXACTLY AS RECEIVED BY REUTERS, AS A SERVICE TO CLIENTS

Related Topics

YOKOHAMA, Japan (Reuters) - Japan's Nissan Motor Co formally launched its zero emissions Leaf vehicle, an electric car boasting a range of 200 kms (124 miles) and billed as the first of its type to be sold on a large scale.

Nissan and Renault are counting on an aggressive push into the nascent electric car market to boost their brand image -- much as the Prius hybrid did for Toyota Motor Corp.

Electric vehicles (EVs) are considered a promising alternative to internal combustion engine cars as governments seek to cut the world's dependency on fossil fuels, but their relatively short range and high price have long challenged the industry.

"When you take the scale of their (Nissan's) commitment, it's a big bet," Kurt Sanger, auto analyst at Deutsche Securities, said on Friday.

"The challenge for Nissan is to capitalize on its early lead and solidify in consumers' minds the perception that EVs equal Nissan," Sanger said, adding: "It's hard to find a car maker that's not planning an electric car over the next five years."

Nissan said the five-seater hatchback was rated with a range of 200 km (124 miles) on a full charge under Japanese test standards, although Californian authorities have rated it at 160 km (100 miles) and another U.S. agency at just 73 miles.

It comes with a suggested retail price of 3.76 million yen ($44,900), discounted to 2.98 million yen in Japan with government subsidies. In the United States, the Leaf will cost about $25,000 after a federal tax credit and in Europe about 30,000 euros before subsidies.

"With today's launch ... we mark the start of a new era for the global auto industry as well as for a sustainable, low-carbon society," Nissan Chief Operating Officer Toshiyuki Shiga, standing next to a sky-blue Leaf at Nissan's headquarters in the port city of Yokohama, told hundreds of journalists.

Delivery of the car will start in Japan and select U.S. states this month, followed by the first European markets in January. Nissan has already filled a maximum initial order for 6,000 Leafs in Japan and 20,000 units in the United States, set to reach customers over the next year or so.

ELECTRIC CAR FOR THE MASSES

Nissan is not the first major automaker to mass-produce an electric car. That honor belongs to Mitsubishi Motors, which launched the smaller, egg-shaped i-MiEV last year.

But Nissan and Renault SA, are aiming to be the top sellers in the market, which they expect to make up a tenth of new vehicle sales globally by 2020.

The partners have earmarked $5 billion over the next few years to mass-produce electric vehicles and the batteries that power them. By 2013, the alliance will have the capacity to produce 500,000 batteries, some of which will be used for hybrid models.

Until production of the Leaf begins in the United States at the end of 2012 and in Britain after that, output would be limited to 50,000 units a year, Shiga said.

Mitsubishi Motors' i-MiEV costs 2.84 million yen in Japan after subsidies, and cumulative sales hit 5,000 units last month after its launch in July 2009.

The EV subsidies are applicable only until the end of Japan's fiscal year, on March 31. The government has yet to announce its incentive policy beyond that date.

A NEW CAR

As automakers including Volkswagen AG and Toyota Motor Corp roll out their EVs in the coming years, they will need to educate consumers to quash misconceptions and prepare them for features unique to EVs.

At Friday's launch, Nissan showed video images of the Leaf undergoing vigorous tests -- including being struck by an artificial lightning bolt in a lab and emerging unharmed from flooded waters that came up to its headlights.

While most big automakers have plans to develop EVs, General Motors and Toyota are for now looking to compete against the Leaf with plug-in hybrids which can which can run both in EV mode and on gasoline. GM will begin selling its Chevrolet Volt "range extender" in the United States this month, while Toyota's plug-in Prius hybrid is due by 2012.

To address "range anxiety" on the Leaf, Nissan has installed normal charging spots at about 2,200 dealers around Japan, and quick chargers capable of charging to 80 percent capacity in 30 minutes, at 200 sites.

An onboard computer connected to a data center tells drivers how much power they have left and how far they can travel.

Nissan is putting would-be buyers through a vetting process to make sure they are the right fit for an EV. Anyone driving more than 100 miles a day regularly would be steered to a traditional gasoline or diesel car, while in some markets, Nissan will give customers with occasional long-distance driving needs an option to rent a conventional car at a low price.

($1=83.82 Yen)

(Editing by Edwina Gibbs and David Fox)

FILED UNDER: