Nissan Sells 395 LEAFs In July, Still Says 20,000 Year End Target Unchanged. Really?

5 years ago by Jay Cole 10

"Excites" Is A Relative Term

Despite Nissan only selling 395 LEAFs in July, Nissan is still holding onto their 2012 fiscal year target, which ends March of 2013, of 20,000 LEAFs sold in the US.  For the health of the plug-in industry, we want to believe.  We really want to believe.   But it is getting harder and harder as the demand (and the math) seems weaker and weaker.

The 395 LEAFs sold in July narrowly misses the low water market for the year set in April at 370.  July’s transactions bring the total sales for 2012 to 3,543 cars, which is lower than at this point in 2011.  In July of 2011, Nissan sold 931 cars.  The trend is not looking good.

Nissan Promises Pricing Changes On US Production To Spur Sales

Still, to Nissan’s credit, they said this was what was going to happen.  CEO Carlos Ghosn himself said months ago that Nissan expected sell (or allocate) no more than “600-700 a month” until production was up and running at the company’s US based facilities in Smyrna, TN.

Perhaps the fact that Nissan has consistantly failed to achieve even that low level, has us all a little nervous for them, and by association, the overall success of the pure electric movement.

Nissan LEAF sales by month for 2012:

  • Jan – 676
  • Feb – 478
  • Mar – 579
  • Apr – 370
  • May – 510
  • Jun – 535
  • Jul – 395

Earlier in the year, one could point to a very thin allocation of inventory at dealerships (mostly in California) as the cluprit to slow sales.  In the first quarter of the calendar year,  inventories routinely stood at less than 500 cars, with a handful of dealers hoarding the bulk, but still Nissan managed to move (on average) about 600 cars a month.

By summertime, inventories had started to grow into 4 digits, while sales had not.  Beginning this month, Nissan had almost 2,000 cars in inventory (up to almost 2,500 currently) and managed to move only a fraction of those off lots, so there is no question that the overall demand is starting to wane.  Nissan PR is undetered:

“Our target (20,000 LEAFs sold by the end of March) has not changed,” said Nissan spokesman David Reuter on Wednesday,  acknowledging that “sales to date have not met our expectations,” while adding that Nissan is working with dealerships to “sell this car, how to educate customers. It’s taking a bit more time. We’re  going to have to do a bit more from a marketing standpoint to create awareness.”

While a 2,000, mostly regional, car inventory is well below the level Nissan needs to be able to put up decent monthly numbers on the LEAF, the company will need to not only publically market the car much more aggressively by the time the Smyrna plant comes online in December, but also follow through on a promise to reduce the price of the car, which will now be freed from the pricing realities of the yen-US dollar exchange.   A situation so bad that it actually forced an increase to the cost of the car in 2011.

Assuming Nissan moves the same 1,810 off dealership lots that it did in the first third of its fiscal year before US production begins, at what price does the LEAF have to come down to in order to move 16,000 more cars in the last 4 months to hit their goal?

In the end, it is always about the money.

 

(Check out our long term review of the Nissan LEAF here, quotes via Detroit News)

 

 

10 responses to "Nissan Sells 395 LEAFs In July, Still Says 20,000 Year End Target Unchanged. Really?"

  1. Shawn Marshall says:

    They would probably sell pretty well at twice the range and half the price.
    Mayhap the EV i s not ready for prime time in the real world where the market rules eventually despite the eforts of corpo-governmental entities to form it according to their own plans. And they use our money, our debt actually since the money is borrowed, to push their agenda.
    EVs will have to stand on their own merit in the marketplace and, so far, the public is yawning.

  2. Wood Foss says:

    I too ponder this question. I recently spoke to the salesmen who arranged the sale of my FFE and his response was that customers are not interested in these autos for several reasons.
    1. Price – People who buy the Ford Focus are looking for a nice, low entry, auto. A high end Focus SEL sells for $23,900. They do not want to pay a $8,000 premium for an FFE. People who can afford the car want a high end Fusion which sells for $27,700. They don’t even want a hybrid because it is also costs +$8,000.
    2. Technology – Like anything new, people are suspect and believe in a few years it will be better, so why risk the technical problems now.
    3. Range Anxiety – The new nervous disorder. “Where can I plug it in?” “If I am stuck in traffic I do not want a dead battery!”
    4. Customers do not even know about the FFE. The salesmen said “Lack of advertising.” Except for the Volt I have not seen one television advertisment for the Leaf or the FFE.

    Will any of this change? Price, Technology, Range improvements, Advertising. ????

  3. Jason says:

    Getting a little off topic, but I think all these plugins are hurt by the fact the 7500 is a filing credit instead of an instant rebate. Many don’t qualify, many don’t want too wait up to 16 months to get the benefit, and some just don’t want the bother.

    Instant rebate would help so much, but government would have to show that as an specific cost expense, now it just gets lost in user credits at tax time.

    1. Bonaire says:

      Government should look to do this as a political act to help lower use of foreign oil. Why require a tax credit for something like an EV when we see the lease banks getting it right away. The consumer should get it right away instead so they can buy the car and not lease it. Why not offer a guy making $50K the $7500 off at point of sale if he or she can afford the payments or has cash stashed away? Retired people drawing down their savings also could benefit since their tax liability is not big enough.

  4. Jay Cole says:

    My apologies to James on this one, (=

  5. Koz says:

    There was a lot of excitement for the Leaf with Nissan’s lofty verbal commitments to EVs, a “real” sized car, 100 mile announced range, and very affordable initial price of $32,780 before any credits. Nissan reeled in 20,000 $75 depositors.

    Now the Leaf is $36+k, EPA rated for 73 miles range before any battery degradation or cold weather, and increased public understanding of range over temperature and lifetime use. It is no wonder sales are suffering. Unless they lower the price, increase the range, or do some combination of both it won’t matter where production is or how many are available on dealer’s lots. Nissan also has a very real problem in warm weather climates that needs to be addressed somehow.

    I may be wrong but my feeling is BEV’s need at least 70 miles of end of life range as a bare minimum to have any meaningful market. I also feel the EPA needs to adjust their rating system to reflect battery degradation over the useful life, perhaps by lopping 20-30% off of the current rating.

    1. vdiv says:

      Now that they are beginning to have direct competition from the Honda fit EV and the Ford Focus EV, the only way to sell more Leafs is to lower and emphasize the price and strengthen the battery warranty to restore some of the confidence lost with the heat-induced capacity degradation. Improvements such as 30A charging, heat pump, and bigger battery capacity would help immensely.

      The Leaf is still an impressive machine and the perfect second/commuter car for any family. Nissan would make a big mistake to drop out of the game just when things are heating up (not funny! 🙂

      1. Bonaire says:

        Ghosn needs to give Leaf buyers $3K out of his paycheck as incentive. He’ll need to get sales up or lose his high-paying CEO job.

  6. Stuart22 says:

    It seems autumn has come early for the LEAF. The car business is about money and profits, and as year’s end draws nearer and nearer, the business case for LEAF production in Smyrna gets dimmer and dimmer. Question is – who at Nissan will take responsibility should the LEAF go belly up? Or should I say, who at Nissan has the guts to point their fingers at Carlos Ghosn for the LEAF’s failure to achieve the success he had promised?

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