Published on November 12th, 2012 | by Christopher DeMorro
Nissan Cancels Opening Ceremony At Tennessee Battery Plant
Sales of the Nissan Leaf electric vehicle are far from inspiring, with monthly sales on average about 15% lower than they were last year. With sales of the Leaf EV at just over 42,000 units worldwide, Nissan’s big bet on electric cars is frustrating some executives. Low sales are also being blamed for the cancellation of the opening ceremony of the Smyrna, Tennessee battery plant that was set to produce around 200,000 EV batteries every year.
The battery plant and factory are at the core of Nissan’s electric car plans, with the plant able to assemble 150,000 Leaf EVs every year. Along with the battery factory next door with a capacity of 200,000 batteries every year, this new facility represents a massive investment on Nissan’s part in a technology that isn’t selling as hotly as they hoped.
Nissan had originally thought that Leaf sales would break 40,000 units in the U.S. alone in 2012. Instead it is looking more like sales will be in the 12,000 to 15,000 unit range in the U.S., less than half what Nissan was hoping for. Between battery problems in hotter climates and waning interest from consumers, Nissan’s grand bet stands to hurt the Japanese juggernaut. No surprise then that Nissan is quietly cancelling its grand opening ceremony, with no replacement rescheduled. Nothing to see here folks, just move along.
But all hope is not lost. While sales aren’t what Nissan hoped for, an updated Leaf model is rumored to be in the works with a lower cost (due to a smaller battery pack). Additionally, bringing production of the Leaf to the United States should also bring down the price of production, as a high Japanese yen is causing automotive exporters a great deal of headaches.
Finally, now that President Obama has been reelected, there is hope that he will pass a $10,000 rebate on electric and other alt-fuel vehicles. Rather than a tax credit, the rebate would take off the $10,000 at the time of purchase, opening the door to electric vehicle ownership to a larger chunk of the population. Obama pledged to have 1 million plug-in vehicles on the road by 2016, and the Leaf was to make up a large chunk of those vehicles. With a $1.4 billion government loan for retooling its facility, Nissan needs to make sure it attempts to live up to its end of the bargain of offering affordable EVs for the masses.
But with so many electric vehicles currently vying for a very limited slice of consumers, right now Nissan is looking at some pretty intimidating numbers. What do they need to do to pull off a major turnaround?
Source: Plug-in Cars