Nissan launches Leaf; bets big on electric vehicles

Yokohama 3 (Reuters): Japan’s Nissan Motor Co recently formally launched its zero emissions Leaf vehicle, an electric car boasting a range of 200 kms (124 miles) and billed as the first of its type to be sold on a large scale.

Nissan and Renault are counting on an aggressive push into the nascent electric car market to boost their brand image – much as the Prius hybrid did for Toyota Motor Corp.

Electric vehicles (EVs) are considered a promising alternative to internal combustion engine cars as governments seek to cut the world’s dependency on fossil fuels, but their relatively short range and high price have long challenged the industry.

“When you take the scale of their (Nissan’s) commitment, it’s a big bet,” Kurt Sanger, auto analyst at Deutsche Securities, said on Friday.

“The challenge for Nissan is to capitalise on its early lead and solidify in consumers’ minds the perception that EVs equal Nissan,” Sanger said, adding: “It’s hard to find a car maker that’s not planning an electric car over the next five years.”

Nissan said the five-seater hatchback was rated with a range of 200 km (124 miles) on a full charge under Japanese test standards, although Californian authorities have rated it at 160 km (100 miles) and another U.S. agency at just 73 miles (around 130 kms).

It comes with a suggested retail price of 3.76 million yen ($44,900), discounted to 2.98 million yen in Japan with government subsidies. In the United States, the Leaf will cost about $25,000 after a federal tax credit and in Europe about 30,000 euros before subsidies.

“With today’s launch... we mark the start of a new era for the global auto industry as well as for a sustainable, low-carbon society,” Nissan Chief Operating Officer Toshiyuki Shiga, standing next to a sky-blue Leaf at Nissan’s headquarters in the port city of Yokohama, told hundreds of journalists.

Delivery of the car will start in Japan and select U.S. states this month, followed by the first European markets in January. Nissan has already filled a maximum initial order for 6,000 Leafs in Japan and 20,000 units in the United States, set to reach customers over the next year or so.

Nissan is not the first major automaker to mass-produce an electric car. That honour belongs to Mitsubishi Motors , which launched the smaller, egg-shaped i-MiEV last year.

But Nissan and Renault SA , are aiming to be the top sellers in the market, which they expect to make up a tenth of new vehicle sales globally by 2020. The partners have earmarked $5 billion over the next few years to mass-produce electric vehicles and the batteries that power them. By 2013, the alliance will have the capacity to produce 500,000 batteries, some of which will be used for hybrid models.