The last time we spoke with Renault-Nissan head Carlos Ghosn, at the Geneva Motor Show, he spoke about the 70,000 all-electric vehicles his company's have sold to happy customers and how these vehicles are just the beginning of the EV era. Speaking at the New York Auto Show a little over a month ago, Ghosn went into detail about how building electric cars around the world will make them cheaper – and thus more prevalent – for just about everyone. He said:
There were two main answers: high price and worries about charging infrastructure. In the US, Nissan dropped the base price of the 2013 Leaf by $6,400 earlier this year and Ghosn said Nissan will "continue to reduce the price as a function of the cost." This will happen not just because of reduced shipping costs and less reliance on currency fluctuations, but because there are still efficiency gains to be had in the new production locations, Ghosn said. "It's not finished."
When we started this effort on electric cars, the first challenge for us was to build credibility for the car itself. Because in the minds of many consumers, the electric car was a golf cart. Zero emission, yes, but everything else was wrong. This first challenge is over today. People driving the Leaf today know it's a real car. Acceleration, driving performance, silence – everything – it's a real car. They still complain. So, all the people who bought the Leaf are very happy. But a lot of people are testing the Leaf and not buying it. We asked them, why are you not buying the car?
As for the infrastructure issue, Ghosn said Nissan is both building out a system of chargers on its own and is working with cities and governments to build more. "What is interesting is that governments are playing the game," he said. "Nobody forced them to offer $7,500 (the amount of the US federal tax credit)." The truth is that many governments want an alternative to oil, he said.
Take Japan, for instance. Ghosn said Japan consumes four million barrels of oil a day. That's $400 million dollars a day taken from the country every day, "for nothing," he said. "f you take a portion of this $400 million and invest it into a technology that employs people in Japan – and you can expand this to France and the US – It makes sense for governments to say, we need to give electric cars a chance."
"Our ambitions on the Leaf are not 2,000 cars a month."
Despite the benefits for governments today, Ghosn said, "frankly, we do not need [government help] forever. That would be doom." With economics of scale, the costs going down and the fact that the technology of the electric car is simpler, "little by little, you are going to see [EVs] as a major segment of the market. The Leaf is here to stay." And it's going to be a big product for Nissan, he said:
Our ambitions on the Leaf are not 2,000 cars a month, we said this from the beginning. At the same time, we know this is a breakthrough technology, we know this is a breakthrough car, and we're just going to have to be extremely patient and resilient and remove the obstacles one after another.
Ghosn also weighed in on automakers collaborating to develop new (admittedly, expensive) technology. Renault is working with Daimler on the new Smart/Twingo, for example, and there is an agreement between Daimler, Ford and Nissan on fuel cells. Ghosn explained that one this way:
With three companies, the overall cost rises again, but now the cost to Nissan is just 30-40. And the end result is probably better because there are multiple sets of engineers. "The fact that Ford, Daimler and Nissan are working together makes them less competitive. They are competing, but everybody wins and everybody pays less to get a better technology and probably contributing to the standard. You multiply this by diesel engines, electric cars and engines by themselves, transmissions, and you see why the industry is going to be more and more collaborative."
Let's suppose I want to develop fuel cells by myself. Nissan, alone. Let's suppose this development costs 100. Now, if I work with Daimler, this technology is not going to cost 100, it's going to cost 120, because we know it is less efficient if you work across companies. Because you have different systems, different languages and different ways of doing things, so you spend a little more energy to develop this technology. Except that, this technology is not going to cost 120, as a whole, but my share is 60. In one case, I paid 100 to get a fuel cell, in the second other I paid 60.