On Friday, I attended a press conference for the kickoff of the Nissan Leaf tour. Nissan CEO Carlos Ghosn was among the speakers, and although he did not announce exact pricing, he did talk about the pricing plan: The electric Leaf will sell for the same price as a similarly-sized gasoline-powered car. The Leaf is similar in size to the Sentra, so my best guess is the price will come in around $21,000... but the battery isn't included.
Nissan's plan is to sell the car but lease the battery. Nissan wants the consumer to see the battery as a consumable, just like gasoline. The idea is that the cost of the battery lease and recharging will be similar to the cost we now pay for fueling our cars with gasoline or diesel fuel.
In many ways, leasing the battery makes sense. Batteries don't last forever, and a lease saves a consumer from the headache of dealing with a battery that has died of old age (and hopefully ensures that the batteries are properly recycled). It also means that if battery technology improves, Leaf owners can get the latest and greatest. Imagine getting a new battery that doubles the car's range at no additional cost.
But there are also problems. For example, what happens if Nissan decides to discontinue the Leaf and stop supporting the batteries? If your lease expires and there's no replacement battery available, you're stuck with a very expensive and very useless bit of rolling sculpture.
Regardless of the pros and cons, I have a hard time imagining that American buyers will go for it. I think they'll see it as Nissan trying to sell them a car without a critical component. To be fair to Nissan, if they sell you an Altima without gasoline, it's just as useless as a Leaf without a battery. But pushing your Altima down the street for a $30 fill-up is a far cry from signing a long-term rental agreement for your car's primary power source.
Frankly, I think Nissan would have been better off not to sweat the cost. Why not sell the car for a premium -- say, $28,000 -- and include the battery, or at least the battery lease? History tells us that buyers will line up to pay a premium for an electric car. (The Toyota RAV4 EV, GM EV1, and Honda EV-Plus all had buyers on waiting lists when they went out of production.) The first group of Leaf owners aren't going to be mainstream car buyers -- they're going to be early adapters who will gladly pay a few extra bucks a month to drive an electric car, no matter how Nissan structures the cash flow. The problem will come from the people who won't be buying a Leaf right off the bat -- the people who are waiting to see how things go for those early adapters. They aren't going to like this whole batteries-not-included deal -- at least, that's what I think. What do you think? Click the "comments" link below and have your say.
Oh, and if you'd like to see the Leaf for yourself, visit the Nissan Leaf web site to find out when the Leaf tour will be hitting your town. -- Aaron Gold
Related: Nissan Leaf EV photo gallery
Photo © Aaron Gold
I agree the lease of the battery is a concept that may have sounded brilliant in the board room but in reality it just collapses. This will never fly in the US market particularly with the examples lain out recently with the discontinuation of specific car brands like Saturn and Pontiac. Though I’m sure Nissan isn’t going anywhere, but the fact remains that potential buyers are not going to jump at the chance to own something that may become unusable at the discretion of the manufacturer. Yeah for new electric cars, boo for horrible marketing.
I think the idea of selling a car but leasing the most expensive and consumable element of the vehicle makes alot of sense…Nissan is not going to disappear and their offer reflects a refreshing sense of understanding that people don’t want to buy long term problems- they want a transportation system. By eliminating the battery system from the ownership equation, and amortizing the cost to ensure that the owners always have access to the latest power offering is smart marketing….
Since you mention the EV1, it made me think about the problems with that as well. Suddenly GM took back all the cars without reason. The same could happen here. Of course it would be a little harder to reposess just a battery.
Still having said that, if they don’t limit the distribution, I would be interested in at least looking at the Leaf. It would make a great around-town runabout. Especially for my wife, who only drives 10 miles through the city to work.
I didn’t think of this before I hit the “Say It” button the first time… This gives new meaning to “batteries not included”.
If electric vehicles become major players in the auto market, I think we’ll see a number of 3rd party companies appear that will offer either battery rebuilding or whole replacement battery packs for cars. This is certainly the case in other industries where integral batteries are used (like laptops or iPods), and I see no reason why this couldn’t happen in the automotive industry as well.
I agree with Chris F. Several companies will pop to produce replacement batteries and probably cheaper than those at Nissan. For now, the Leaf’s popularity is going to be limited by its range(100) and its recharging time (8-16 hrs), as reported by Motor Trend, 11/2009 issue. I see it strictly as an urban commuter vehicle.
OK. Let me see if I understand this. I can buy an electric car for $20K (a price at or about what I’d pay for a small, fuel efficient gas powered car), but, I have to pay extra on a monthly basis not only for the electricity that powers it, but now also for the batteries?!!!! Why didn’t car companies think of this earlier!! Sell the rolling chassis, and lease the engine and transmission!!!
How else can we milk the consumer for more and more money, and drive up the cost of energy at the same time? It’s going to cost untold billions and God only knows how much real estate to build enough wind machines (the only truly clean electric power generation source I’m aware of) to power all of these things if they truly catch on, unless we resort to coal. I’m sure the environmentalists will just love all of the extra coal mines that we’ll have to start.
If you haven’t already guessed, I think this is a ludicrous idea. The aftermarket will come up with new batteries to power these things no matter what the manufacturers do. This is just one more example of something that looks like a really good deal on the surface, until you start looking at the total cost over the course of time. Then, it gets to be pretty darned expensive. I haven’t even mentioned the fact that all of this technology is still in its infancy, and is bound to develop any number of unforseen problems that few except the manufacturer will know how to fix. Guess who wins there?
I for one am not willing to spend four times what I’d pay for a regular car just so I can reduce our dependency on foriegn oil, or so I can feel good about myself because I’m somehow “saving the planet.” This car is just another gimick intended to promote the “green” movement. Nothing more.
I’ll pass.
BTW:
BTW: Only a very few short years ago, nobody thought that GM would go away either. Granted, it would have if not for the grace of the government, but the point is, anything is possible, especially in the auto industry.
BTW: Nothing in the auto industry is for certain. It wasn’t all that long ago that nobody figured GM was going anywhere either. If not for the grace of the government, they would have just a few months ago (let’s not get into that arguement here again. Just an observation).
Who has the time and the money that they want a car that you have to buy and lease at the same time? Not most middle income families these days that are being pinched by higher local taxes and other rising service costs. Stupid idea Nissan.
Won’t Radio Shack stock the batteries? No?? Then forget it!
Given that electricity costs pennies on the dollar(probably 10-20%) compared to gas and that electric cars have far fewer moving parts to break/service (tires, breaks and battery only… no more tune ups, filters, oil changes, exhaust, transmission service), the cost of the battery is easily offset by the savings.
Think of the battery as a standard service item for the car that replaces many of the service items for gas vehicles. It just gets replaced far less frequently.
It like to see this all worked up in a “true cost to own” breakdown. I think we would all be pleasantly suprised.
I don’t understand the savings of buying a Leaf then??? If I’m paying as much for a lease on a battery as I would be paying in gas, where are my savings? If they would sell the Leaf at, say, $15000 and lease the battery for, say, $50/mo, then I could see considering it. But you may be sarting with a $250-$300 payment and tack on another $100+ a month for the battery lease….I don’t thinks so Quicksdraw!!!
Regarding the “premium” price of electric cars, people are willing to pay for such things if there’s a pronounced benefit to them. Look at laptops….they cost more than a desktop, aren’t as reliable, aren’t as powerful, and have higher ongoing costs (like replacement batteries), yet the majority of computer buyers opt for a laptop for the small size and portability. The same may eventually happen with electric cars…the much higher reliability of an electric drivetrain and lower fueling costs may be big enough selling points to override the higher initial costs, battery costs, and distance limitations.
Another thing we need to consider is that the electrical grid of the United States dates from the 1950s….it’s not capable of supporting the recharging of a few million electric vehicles every night. Electric vehicles won’t happen en masse until we’ve brought the grid into the 21st century, but where’s the money to do it going to come from? Private industry is only willing to spend just enough to keep the grid from failing.
ChrisF: Maybe the answer is contained in your question. If private industry is willing to keep the grid from failure, perhaps they will keep it from failing when greater demand is placed upon it as well.
Updating power grids is important right now. So maybe creating a support system that will eventually charge millions of electric vehicles at a time should come first, but increased demand for electrical power will drive the cost higher just as it does with the demand for fuel.
I’m getting the impression that we’re building the cart without having any idea what a horse is to pull it.
I think electric cars arent quite developed yet. What I mean is.—-Gas/diesel cars still have batteries that needs to stay charged. They use an alternator that uses the cars belt system to work. Why cant they hook an “alternator” into the axle system. (You know what I mean) place an alternator where it turns the whole time the car is rolling. I realize the car is stopped at times too (stoplights etc) but it is rolling quite often also. It can be combined with an outside recharge source, but that would be required less often if the batteries are under constant charge when the car is in motion.
****OH and why not give the customer a choice Nissan? Let customer purchase the batteries and charge accordingly. Or reduce the cars price accordingly and let the customer “lease” the batteries.****
I’ve come to a conclusion while reading a movie description for Love the Beast starring Eric Bana and I think it explains why so many of us that visit and blog on car websites have such an aversion to electric cars.
First off, the movie is about his life long love affair with his 1974 Ford Falcon Coupe and what happens to it during the Targa Tasmania Rally. The story follows and tries to explain the emotions that gear heads have for their cars and what they will go through for them. Its that the car in the movie and the cars in general for us display more of a personality with the more time we spend with them and work we put into fixing them.
For me it was my first car, a 1976 Chevy Monte Carlo. I’d spend hours just tinkering around with rebuilding the 4 barrel Holly carb, checking the timing, distributor cap and spark plugs. I could tune the choke by ear and get that big 350 V8 purring to perfection. Replacing the radiator once was an all day affair on a Saturday and gave me a super sensitive nose for the rest of my life to anti-freeze. I promised myself once to put bigger brakes on it, but never got around to it. Then, one day, traffic stopped and I couldn’t. One of the front bushings had rusted on the front clip that the radiator sat on. The whole front end snapped off and totaled the car. I was devastated. I thought I could always fix that car.
That’s my story and here’s the point of it. Most of us can’t fix or work on modern cars so it’s the thrill of driving something with a feel for the road that makes us want a Mini Cooper S, VW GTI, Civic SI or Pontiac G8. They all have a personality of their own that we can fall in love with. Electric cars don’t and may never have that feel or personality and they make us feel even more detached by their complex systems. Their inability to help us form an emotional attachment to them drives us away.
Actually, Jay I would think that an EV is actually less complex. Sure, it doesn’t make those great sounds that set a car guy’s heart a-flutter. However having modified and raced electric radio-control cars as a teen, I know there is a lot than could be done. I’d be really interested to see what happens in the EV aftermarket. Motor swaps, timing adjustments, battery tweaks… its all possible.
There will never be such a thing as a 0 polution car. There is polution from the generating plants that privide the power that will propel the vehicle.
This “leasing” of a battery sound a lot like Obama’s wasted attempt on health care. Americans are middle road auto consumers and will likely not have the ability in the furure to own a “commuter” car and a regular car that allows them to live with their families and do the things families do! Don’t be fooled into thinking this is an end all to end all problems with transportation. The future will offer a conglomerate of choices and the electric vehicle will be a small part, if any, to the ongoing equation of personal transportation.
P.S. Don’t overlook the horse!
Love the idea of an electric car. Love the size, styling and setup of the Leaf. I will be one of the first to get one! But if Nissan continues on this path with a leased battery I may have to continue with my gas cars.
What is so hard to grasp? I am one of those people the keeps cars until they are worn out (normally 10 years or 120k mils) if I did that with this I would pay an additional 18k in battery lease costs. I already limit my driving to only do what is necessary, all my cars get over 30mpg (all Nissan’s). I pay on average about 45.00 a month in gas (per car), and normally don’t pay over 20k to replace a car. Why would I line up to pay more for the car and then pay another 150 a month for a battery lease? Where did the frugal part of this setup go?
Now, if the lease is a sensible amount like $1000.00 for a four year lease, or something similar I would not balk. However if its looking at an additional (permanent) monthly payment just for the battery lease, it will be a deal breaker for me.
Nissan please listen, charge more for the car if you must, but keep in mind most people are not looking to replace one monthly debt with another, they are looking for a cheaper, green alternative.
If I have to lease the battery, I will either lease the whole thing (car & battery) but I will not buy a car with out a motor.
I,m not excited about a lease on these batteries either but replaceement costs would send you into cardiac arrest the batteries would be at the very least one half the cost of the car. Thats why the lease is in place.