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Nissan-Renault CEO Carl Ghosn seems to be taking career advice from Frank White lately; wherever there is an opportunity to start making some money, he wants in. Recognizing that full size vehicles were a cash cow in the U.S., Ghosn wanted his cut. Shortly after taking the reins of Nissan in June of 1999, he built a factory in Mississippi to start churning out big trucks like the Titan and the Armada.
Now, the field has changed. With fuel growing more expensive and the business climate starting to take heed of green, the government is granting enormous subsidies and incentives to potential electric vehicle manufacturers.
Again taking advantage of prevailing market conditions, Ghosn is priming Nissan to be the first company to make a success of EVs.
The Nissan Leaf has several advantages over its peers in the field. First, it promises to be substantially cheaper than the Tesla Roadster. You buy a lot more sex appeal with Tesla’s product but that isn’t the angle the Leaf is working; Nissan is building a practical mass-appeal vehicle first. The Infinity luxury EV comes later.
The Leaf also gets better range than the Chevy Volt in electric mode, though when the Leaf’s battery dies there is no ICE engine to save the day. It’s just dead.
FedEx corporate chairman Fred Smith, Ghosn and others banded together in Washington D.C. on Monday calling themselves the Electrification Coalition. Together, they determined that 75 percent of driving should be done on battery power by the year 2040. This goal works nicely with Nissan’s plan to introduce the Leaf in 2010.
The Electrification Coalition also determined that the average household car takes six trips a day, each trip just under 10 miles on average. Gas vehicles don’t have a problem with this. The Chevy Volt, for instance, would run out of charge before the day’s end — especially considering that there are about a 1,000 electric charging stations nation wide. With this in mind, the coalition calls for incentives equal to 75 percent of the cost of building charging infrastructure.
Taking full advantage of government incentives, though, has its costs. Ghosn told the Wall Street Journal that “We aren’t putting electric cars in markets where they don’t have an incentive for consumers.” This means that electrics in China might be a while, even though China could be Nissan’s biggest market within the next few years. Financially sensible for Nissan, this line of thinking may make the government’s ability to subsidize a limiting factor in EV propagation.
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