Speaking at the New York Times Energy Conference in Paris last week, Nissan-Renault CEO Carlos Ghosn told reporters he has plans to offer an all electric car in the Chinese market that will sell for no more than $8,000 after all incentives. Ultimately, he wants to build an electric car that costs as little as $7,000 without incentives. Those are ambitious goals. “If we are able to make this kind of breakthrough, it’s going to change the game,” Ghosn said.
Nissan’s efforts to sell a rebadged version of the LEAF in China have met with little success. Ghosn says the LEAF, known as the Venucia e30 in China, just costs too much money for mainstream Chinese buyers, most of whom are not tech company billionaires. The Venucia e30 sells for around $37,000 in China. “What we want to do is bring a $7,000-8,000 electric car without incentives,” he said.
At the present time, the government of China offers buyers of so-called “new energy vehicles” substantial incentives that go beyond just rebates and credits. A person who buys an electric car is entitled to register it immediately. Those who purchase a conventional car must wait to get permision to register it through a lottery, a process that can take up to 5 years.
China has set a goal of 5,000,000 electric and plug-in cars on the road by 2020, but all those incentives are expensive. The government has indicated that it cannot afford to offer such generous provisions indefinitely. That’s what makes Ghosn’s target of under $8,000 without incentives so important. He is already planning for the time when all the help from the government will disappear.
Nissan’s chief executive offered no guidance on how he plans to accomplish his objective. Obviously he is expecting battery prices to continue falling but there has to be more to the equation than that. The cars themselves will be basic transportation with few frills, similar to American cars like the Ford Falcon that came standard with crank windows and rubber floor mats in the 60’s. That may be good enough for many Chinese shoppers who just want to be able to get from Point A to Point B and back again without walking.
Source: Economic Times of India