Is Nissan Concerned Over ZEV Credits, Possible Future Shortfall?

JUL 16 2016 BY ERIC LOVEDAY 33

Nissan LEAF

Nissan LEAF

60 kWh IDS Pack Next To 30 kWh LEAF Pack

60 kWh IDS Pack Next To 30 kWh LEAF Pack

A recent Automotive News article focuses on Nissan and California’s ZEV requirements.

The article opens with these statements:

“To say that Nissan North America is completely comfortable with the regulatory demands it faces on zero-emission vehicle sales around the country is probably an overstatement.”

“But in truth, few, if any, multisegment automakers are in better shape than Nissan.”

Nissan was one of the first automakers to mass-produce and sell electric cars in the U.S. It began way back in 2010 with the launch of the LEAF. Automotive News states:

“By virtue of mass-marketing its Leaf electric vehicle in the U.S. for the past five years, Nissan is already in full compliance with the ZEV requirements for California and the nine other states that follow the California regulations. And because Nissan began selling the Leaf before ZEV requirements in those states in the Northeast were in effect, the automaker will receive some privilege and flexibility as the regulations get tougher.”

To continue to be in compliance, Nissan simply needs to continue to market and sell the LEAF at appropriate volumes in the right states. According to Automotive News, this isn’t as easy as it sounds:

“That will take some careful sales planning, cautions Tracy Woodard, the company’s director for government affairs. The company obviously would like to see Leaf sales rise everywhere. But having strong Leaf sales in Georgia, for example, will not help Nissan meet its ZEV requirements in New York and Connecticut, she points out.”

“So the automaker must make sure it has adequate inventories on hand in the ZEV states — even if it means other states have a harder time getting inventories — and also devote more resources to marketing the Leaf in the states that, under California’s rules, require ZEV sales.”

The concern for Nissan right now is dwindling LEAF sales, due to an aging car and the anticipation of the upcoming debut of the next-generation LEAF (which will happen in the very near term – trust us).  For the time being, Nissan’s ZEV position is in good shape.

Looking forward at much tougher regulations (up to 16% ZEVs by 2024), Nissan execs do still seem a bit concerned about continuing to be compliant.:

“Nissan is OK for now, Woodard says. But Leaf sales do need to carry the load for a ZEV requirement that will rise between now and 2024.”

“Two things could make it tougher for Nissan: The brand has had few competitors in the EV segment until now. As the ZEV requirements confront the industry, Nissan likely will see more competitors trying to win away Leaf customers.”

The next-gen LEAF can’t come soon enough, especially since Nissan sales are on the rise overall in the U.S., which means ZEV sales must increase too.

In our eyes, Nissan is in a fine position in regards to ZEV credits/compliance and the automaker should be more than okay in the coming years. However, there are lots (and lots) of other automakers out there that we can’t say the same about.

One things for certain…compliance regulations will push automakers to get into the EV game and those automakers will have no choice but to market the plug-in cars.

Source: Automotive News

Categories: Nissan

Tags: , ,

Leave a Reply

33 Comments on "Is Nissan Concerned Over ZEV Credits, Possible Future Shortfall?"

newest oldest most voted

The current generation Leaf will get a 40 kWh battery later this year. The 24 kWh will be discontinued, options will be 30 and 40 kWh.

If the 40 kWh Leaf is the longest range Leaf available it will die an early and much lamented death.
The time for BEV’s to be limited utility city cars is ending. Or at least I hope so.
Once the Bolt is out in 5 months, hopefully other choices in the sub-$40k BEV class will show up relatively quickly with 200+ miles of range.

Why? The Leaf 2017 would be around 5000 $ cheaper with 40 kWh than the Bolt in US. In Canada more, you see the Bolt price (46.500) in Canda are much more than Leaf 30 kWh (37.300). You see the Bolt US price is subsidized. And if Bolt comes to Europe you will pay easy 10.000$ more, just info of a guy working at Opel the price will be above 43k€ while the Leaf 40 kWh could be same like 30 kWh, just 34k €.
So not Leaf is dead, the Bolt will be dead before arriving, thats why GM don’t build and right hand drive for UK excecially when Renault-Nissan bring 40 kWh to Zoe.

$5,000 cheaper? In what world?
The short legged 24 kWh Leaf is selling for around $26k and the slightly better 30 kWh Leaf for around $31k.
You can get a full utility 2017 Volt for just $32k.
What would most people choose, a 40 kWh limited utility BEV Leaf for a probable price of $33k or a full utility Volt for the same price? (10 extra kWh will cost around $200 each, so $2k more than the 30)
Unless you are a Leaf fanboi, the choice is obvious. The Volt is a substantially better car.
The Leaf is dead if they don’t get at least 55 kWh and a price reduction.

Not everybody can afford more range, more style, more connectivity… I certainly believe that 200 mi is the magic range for mass adoption. However, Nissan (and a few others) are in a position to test the proposition that there is a market for an inexpensive city car. I suspect that a lot of new buyers will discover what many of us already know. Range anxiety is a myth. Then maybe more people will realize that 100 mi is more than enough for a city car.

I don’t think more than a relative handful will accept 30 or 40 kWh BEVs in the future, but I would like you to be right. Any car with a plug is a good thing, and every affordable extra mile of AER is even better.

Price makes a big difference. 40 KWh version may have 140 mile range and it its priced around $34,000 of less, then it may stand a chance of getting sales.

While Bolt will be in its 1st year and Leaf is in its 7th year, the Leaf is slightly bigger in size and may have some appeal.

Ideally I would like them to price it at $32,000. But if Nissan keeps the same ranges at same sizes, then their sales will crash.

Even in my ICE I don’t do 200 miles in a day. Many of us are happy with the 100+/- range limit, and are more than happy charging from home overnight. This is the inconvenient truth: Generation 1 and 2 Nissan Leafs are not for everybody. I live 30 miles from work, and if I had to drive further I would either move or find another job. The Bolt or Model 3 is not on my shopping list, because I already own a Leaf. It is a commuter car. My AMG is parked because it sucks gas.

My monthly cost of driving to work is now 1/5 of my former gas bill. My commute is littered with charging station options ranging in cost for $0.85 to $7.00+ to get to 80%.

Finally, for others who don’t like the way it looks, then don’t buy it. (wow!… mind blown!!)

About the 40 kWh on current LEAF design.

Educated rumor or are you certain this is coming in late 2016 based on your sources?

PS: If true, it could extend the current LEAF in case the LEAF 2 (and ZOE 2) arrive a little later than expected, e.g. 2018 instead of 2017.

“……the upcoming debut of the next-generation LEAF (which will happen in the very near term – trust us).”

Tell us more 😉

“which will happen in the very near term – trust us”

Oh really? Does that mean you’re sitting on information you haven’t published yet? I am waiting with anticipation! 🙂

I renember last year in 2015 March writing an e-mail to insideevs about some selling numbers of the Leaf. And they write back “nissan is working on something for autumn”. They were correct with 30 kWh Leaf. This time I would be real surprise if Leaf 2018 comes in early 2017, I think a Leaf 40 kWh 2017 based on todays version is more probably.

I’m guessing InsideEvs will be among the first to know given their track record and standing. Most likely to be embargoed with NDA until a specific date. I sure wouldn’t want to have to keep that secret. Nissan isn’t in Tesla’s league, but a 200 mile Bolt will be arriving soon and Nissan simply can’t compete with current gen so will have to at least unveil the Leaf 2.0 if not begin sales around that time. It will be a very interesting 2nd half of the year.

There is nothing embargoed/NDA’d out of Nissan – they are just trying their best to keep the horses in the barn themselves, (we rarely get involved with that sort of thing anyway). That said, we did break a lot of news on the Nissan LEAF in the past (S base model, first bump to 84 miles, the 30 kWh/107 miler, etc). However, the last story (on the 30 kWh) resulted in a fairly adverse reaction to current Nissan LEAF sales in the US. With that in mind, and while there are some great stories that could be printed (and quite awhile ago – long lead times to develop a product and all), we also know those stories could be potentially devastating to LEAF/other EV sales short-term in the US and worldwide. We have decided that the trade-off of news around this subject (as well as a little short term glory/traffic for us), is not worth the risk to the market – we might do some stories when we are ‘right on top’ of the timing still, but that would be about it. It has been a bit of an internal struggle for us – news outlet vs EV advocates. In… Read more »

That’s a good policy, you shouldn’t burn your bridges with Nissan for some short-time glory. And as you say, it’s more important that the EV market grows.

That’s what we were thinking…not so much about the burning bridges, being in the “EV news” business can make you unpopular with an OEM at just about any time, but just for the ‘greater good’.

If we were rolling stories about Nissan’s future plug-in plans earlier this year, that would have had the potential to derail 1000s of sales. And that would be hard to rationalize for us.

I think the issue here is that most people realize the moment they buy an EV it will be obsolete/improved on almost immediately…but if they KNOW FOR SURE what they are buying today is inferior to tomorrow, then there is a reaction to either not buy and wait, or to look at someone else’s product that they don’t KNOW is headed for a step-change (blissful ignorance).

That is a horrible policy as news sites jobs are to report news unless Nissan directly provided the information under an NDA…
The job of news sites is to inform their readers of what matters to them not to provide protection to multi billion dollar corporations…
Every EV being sold for the next several years will be quickly outdated…
As a consumer I do not like what you just stated as I am not rich so my money is much more valuable than that of established manufactures and their billion dollar profits…
Please protect the consumer and not billion dollar auto companies… This might harm short term sales but it can very well help long the EV industry in the long term and your site by being a true and honest provider of news…
The auto industry and EV industrie are not babies…

Than just buy a used Leaf for half or less. When insideevs publish the news its bad for market and the EV market worldwide is tiny. We have just 1,5 Mio EVs on the road and every year 100 Mio gasoline cars. When dealers talk about things they should not talk, insideevs should also not publish dealer secrets.
Just every car loose money, even if you buy a 2018 Leaf with 60 kWh it will be old in three years.

Yoda, Completely understand your opinion. We actually don’t ask/receive embargoed or NDA information for this reason…so we can put out the news as it happens. A good example of this was 2nd gen Chevy Volt, many major outfits got first looks/drives months ahead of the official release, but had to sign an NDA to basically say nothing “new” about the car for details, pricing, roll-out timing, trim levels, etc. So we were free to report all the stuff weeks and months early. — However, from our point of view in this case, it is a little different. It is certainly not to “protect billion dollar corporations”. It is to protect the EV segment itself, and encourage the adoption today, tomorrow, and 2 years from now. I realize there is a catch-22 cycle in there with us being a news site and all that…and it is an uber-rare occasion where we sit on something. But one has to realize that the planning/specing of the cars you see today is hardwired years in advance, and those secrets are keep very tightly…in fact they don’t get out. They just don’t. And we aren’t talking about breaking news about a new EV model coming,… Read more »

Thanks for the reply Jay…

I dont blame Nissan,Tesla, or GM as they are businesses doing what is best for their business and what that are required to by law…
Whith that said the law does require them to make EVs so none of them are going away…
Tesla has taken the cat out of the bag wound up its tail and shot it off…
So it is only a matter of time before all cars are EVs not because of laws but because they are simply better and will be cheaper within 10 years if not much much sooner…

I understand your position but I do not think publishing is truly harming the EV industry…

Nissans sales went down in the US (but not necessarly elsewhere) after the upcoming 30kv was published but stayed down even after it was released…
I think this is largely due to fact that early adopters have already got everything they would at the current price point of EVs and marginal range increases without out battery price decreases are just that… marginal…

Hey Yoda, It’s true the current first gen “city EVs” do have a limited market penetration cap…I’m not sure if that actually is ~1% in the US or not, I suspect it is higher. Personally, I think that if there was no Model 3 or Bolt EV debuts so early (if GM had a mass produced city EV today, you can bet they would have just debuted the Bolt EV in LA this Fall) that Nissan would have sold an extra ~50,000 at least of the 30 kWh LEAFs worldwide…because that would have been the gold standard for inexpensive BEVs. Nissan has been competing against phantoms for the past ~2 years. Again, us spilling the beans on the next gen plug-ins from Nissan last year would have been devastating to not only Nissan, but the industry. Just to give you an example for argument’s sake, lets say we got a hold of data leaking that a mid-gen battery upgrade was in the works for the next gen LEAF coming out next year. And that ~$35,000 car (2016 equivalent) was planned to have a 100 kWh battery and 400 miles of real world range in 2021 (as a 2022 MY) for… Read more »

And last thought…

Might it not be best for the EV industry if sales decline for high priced short range vehicles thus forcing big auto to compete and provide longer range EVs for less money…

The longer big auto stagnets the more and more likely it is for BYD and others to come to the US and thank them for their customers…

Not really…the misconception is that this industry is moving forward as a result of competition, or even demand.

It moves forward only because of CARB, the EU…and those government’s which are now forcing the issue out of emission/climate change concerns.

In 2025, 1 in 6 cars sold worldwide will come with a plug whether or not you, me or your grand-dad wants them. How many cars that are already on the road by that point in time cumulatively is (in part) a result of how many that can be sold today. As I mentioned, it is my opinion we are already at least ~100k short thanks to “jackassing” the process.

Another thing folks don’t quite understand besides that auto makers really don’t want to build EVs, they also aren’t really going to build 16% of their cars as EVs in 2025. Those CARB compliance percentages are for ZEV CREDITS, not cars. So, if a hydrogen car earns 9 credits, for every percentage of required compliance, they only need to build 1/9 as many hydrogen cars. That’s one of the big winners for hydrogen… you just don’t have to build many cars to comply. Over three years, there are 900,000 oil burner Toyota cars sold in California according to the California Air Resources Board (CARB). The current 0.79% credits rule of CARB Zero Emission Vehicle (ZEV) sales means that 7110 credits must be earned over three model years. Each Rav4 EV earns 3 credits each, so 2370 battery electric cars solve that over the three model years 2012 – 2014. They will build 2600. Perfect, problem solved, and they really didn’t even advertise it, nor get their hands dirty designing it (Tesla built the entire drivetrain). But, the 9 credit Toyota hydrogen car needs only 790 individual sales over three model years TOTAL, or 263 average per each model year during… Read more »

Price and range is not everything.

You probably know that by 2020, all diesel cars and trucks and most gasoline cars will be banned in Paris. And that includes also ICE two wheels and hybrids (even plugin hybrids).
That’s a trend in big EU cities.

So if you live there what’s your choice: park your car outside the city far away and finish your trip with the underground or buy a more expensive EV car? Even range limited?
Millions of people will have either to switch to EV or park their ICE cars at the end of underground lines.
That’s only in 3 years and a half….

Jay,

I wasn’t accusing, just guessing at the process. You are in a difficult position for sure. I like your take on not harming the segment. Keep up the good work.

From a competitive perspective as soon as GM’s Bolt is in showrooms Carlos Ghosn will get this question from the press until he cracks one day and spills the beans 🙂

I don’t think Nissan (and Renault with its Zoe) can hold back with more specific hints – or even a formal launch window – beyond calendar Q3 or Q4 2016.

PS: As discussed above, a 40 kWh version for current car designs could be an interesting stop-gap in case the Leaf2 / Zoe2 aren’t ready for a 2017 launch.
Or maybe even a lower-end solution that’s sold along the new cars?!

Nissan is still way ahead with the 96,000 Leaf’s that they sold so far in USA and this is a 100% Electric Vehicle.

But after 4th year, sales typically begin to decline. Now Leaf is running in its 6th year and no wonder its sales are going down.

Leaf’s S Trim with 84 mile range is just 31 more than Volt and the Volt costs just $4,000 more and can run for another 300 miles on gas after the battery runs out.

And if the same model Leaf continues into 2017, then it will be in the 7th year and something has to be done to boost its sales especially in the light of Bolt having 200 mile range.

Well Nissan can have 30 KWh as the base trim at around $28,000 and offer 40 KWh (140 mile range) in the higher 2 trims with price around $34,000. If they increase it any higher, the customer will easily look for Bolt which has much higher range.

Time is inching along ever so slowly. I feel like we haven’t had any really substantial news, except for VWs new strategy to 2025, since the Model 3 reveal more than 3 months ago… and I’m impatiently awaiting the Bolt. I believe Nissan will let us know something more about second-gen LEAF as soon as the Bolt is out, if not just before (what’s the best way to steal its thunder?), and that LEAF 2 will likely start selling in spring 2017.

I have nothing more to go by than my own guesses and the hints InsideEVs dropped in the article – which frankly point to a still earlier LEAF 2 arrival. But it’s fun to guess and feel like I was clever if it turns out not totally wrong. ?

I’m hopeful to hear of at least a 42kWh battery late this year… 48 to 54 would be even sweeter… they would give Bolt a run for its money. Especially with a nice highly functional body 4 good size doors… hatch. Early as possible… as many models as possible offered with ev powertrain.

FWIW I bought a used 2013 Leaf recently because I needed a car and it was the best EV I could afford. The sales guy tried to talk e into leasing a brand new 100 mile LEAF but the huge discount on used was way more appealing to me than having to turn in another lease with nothing to show for it or buying new at $30k+. He then told me that Nissan would soon come out with a 220 mile version. I certainly don’t trust salesmen and have no reason to suspect he had detailed advanced knowledge, but that’s what he told me.

Well . . . build a better looking car then. Or you could always buy credits from Tesla.

People are OK with buying “instantly obsolete” computers because they are easy enough to upgrade with new hardware and software. If we knew we could get “better” (longer range) batteries after initial vehicle purchase, it would ease the hesitation to wait on something better. On the software front, I am holding out for a Model 3 because they are the only company to willingly upgrade the thing after purchase.