Nissan Motor Co had announced that it will spend 2 trillion yen over five years. This is for accelerating the vehicle electrification to catch up with competitors. This is the first time Japan’s No.3 automaker, one of the world’s first mass-market electric vehicle (EV) makers with its Leaf model more than a decade ago, is unveiling a comprehensive electrification plan.
Nissan will be spending twice as much as it did in the previous decade. All this is for a share of the EV market as rivals. Toyota Motor Corp and Tesla Inc, are moving ahead with their electric-car plans. Nissan stated that it will launch 23 electrified vehicles by 2030. This includes 15 electric vehicles (EVs). Also, they want to reduce lithium-ion battery costs by 65% within eight years. They are also planning to introduce potentially game-changing all solid-state batteries by March 2029.
Chief Executive Makoto Uchida said that those commitments would make EVs affordable to more drivers. In an online presentation he stated that they will advance their effort to democratise electrification. Shares of Nissan slid 5.6%. This is due to the underperformance in its major rivals. Some analysts were unimpressed with Nissan’s plan. They noted that it was already behind its rivals in electrification. Masayuki Otani, senior analyst at Securities Japan Ltd, stated that the auto shares were falling. This is because of the concerns about the new coronavirus variant, as it would squeeze production.
He said that Nissan’s long-term vision comes at a time when the market is perhaps not receptive to it. It can be said that it represents a huge increase in investment. Nissan’s electrification plan comes as it pulls back from a pursuit of sales volume pushed by former chairman Carlos Ghosn. Both the production capacity and model types will be slashed by a fifth to improve profitability.
Chief Operating Officer (COO) Ashwani Gupta, when asked about the share price at the gallery at its headquarters in Yokohama, said that it is very important for Nissan to show where they are going next. Today’s plan is a vision and direction for the future. According to the International Energy Agency (IEA), only a small portion of vehicles on the road, global electric car registrations in 2020 grew 41%.
Major car makers, such as General Motors and Ford Motor Co, signed a declaration at the U.N. climate summit in Glasgow, earlier this month. This had committed them to phase out fossil fuel vehicles by 2040. Nissan, has not committed to abandoning gasoline vehicles. It said that half of its vehicles mix will be electrified by 2030. This includes EVs and its e-Power hybrids. COO Gupta said the goal was a reference point, and that may change.
Nissan in July pledged $1.4 billion with its Chinese partner Envision AESC in building a giant battery plant in Britain. This can power 100,000 vehicles a year. They will spend $13.5 billion by 2030 to develop cheaper, more powerful EV batteries. Toyota has said it is aiming to introduce solid-state batteries by the mid-2020s.
