YOKOHAMA, Japan — A decade ago, Nissan spent billions to pioneer new auto industry ground by introducing the Leaf electric vehicle as a mass-market family car.
Together with alliance partner Renault, Nissan thought it could sell 1.5 million EVs by 2016 and promised new EV models in quick succession, including an all-electric premium car from Infiniti.
Not only did most of those nameplates never materialize, the alliance missed its sales goal by 1 million vehicles.
Even at lower volumes, the Leaf became the world’s top-selling all-electric nameplate. But this year, the car is on the verge of losing that bragging right to the Tesla Model 3.
Times have changed, but so has Nissan Motor Co. The world’s would-be EV leader is now charging up for a second crack at the segment, and the automaker is as optimistic as ever.
In a series of interviews with Automotive News, top executives said Nissan’s latest push will be different for several reasons. Nissan’s technology is improved, the market is more receptive, and perhaps most important, the company’s aspirations are more realistic.
The first test comes in 2021 with the launch of the Ariya electric crossover, the kickoff vehicle for Nissan’s next wave.
“We’ve come a long way,” CEO Makoto Uchida said. “The Ariya will represent what Nissan is.”
A lot is riding on the Ariya, not just for Nissan but for its fragile alliance with Renault.
The high-tech crossover — a more upscale model than the Leaf — is a linchpin in Uchida’s gambit to elevate Nissan’s brand image as it becomes a smaller, smarter company. At the same time, the Ariya’s newly developed dedicated EV platform is supposed to deliver on the promise that Nissan and Renault can achieve better synergies and cost-sharing — something the partners famously failed to achieve when they rolled out their individual first generation of EVs a decade ago.
Under the new umbrella of EV cooperation, four more EVs are coming from Nissan by early 2024, plus an electric crossover from Renault.
This year, the alliance automakers, which now include Mitsubishi, adopted a new “leader-follower” strategy globally, and Nissan was entrusted with spearheading the important development of midsize EVs for the group.
Yet success is anything but guaranteed for the new generation of EVs.
When the Leaf debuted, it stood out among a small clutch of competitors in an entirely new segment. By contrast, the Ariya must fight in a maturing market packed with compelling rivals.
Nissan also must persuade customers to shell out more money — possibly much more — for the Ariya, which is loaded with the latest electric powertrain and automated driving technologies.
A sudden jump upmarket will be a tall order for a public used to Nissan as a discount brand.
Nissan also may be hard-pressed to sustain the outlays needed to keep its EV lineup fresh in the coming years. Nissan is braced for its biggest-ever operating loss this fiscal year. Its setbacks have spurred a companywide campaign of cost cutting to bolster the bottom line.
“During this period, Nissan will be facing an extremely difficult time in terms of profit,” said Koji Endo, an auto analyst at SBI Securities in Tokyo. “They have to reduce expenditures while somehow keeping investment in new products. Some projects might not be able to get enough budget.”
Nissan’s strategy hinges on a new common-module family platform for EVs called the CMF-EV. Nissan began working on it about four years ago, sharing it with Renault.
In March, Renault previewed plans to use CMF-EV with the Morphoz concept, a crossover counterpart to the Ariya. The Renault CMF-EV entry is expected to go into production at the end of 2021 or early 2022 and be built in France.
By comparison, Renault’s first EV, the Zoe, shared almost no significant engineering with the Leaf — even though joint synergies had been the alliance’s raison d’etre when the two automakers joined together in 1999.
The CMF-EV was designed for flexibility, with Renault specifications in mind, said Executive Vice President Kunio Nakaguro, Nissan’s global R&D head. It can accommodate variable battery sizes, body shapes and motor configurations, from single to double. In addition to the crossover, body types might include a hatchback, sedan, multipurpose van or even a sports car, Nakaguro said.
Nissan is working up another EV platform for Japan-market minicars. An all-electric mini, based on the IMk concept shown at last year’s Tokyo Motor Show, is one of the upcoming EVs.
The CMF-EV layout allows a D-segment interior in a C-segment package, thanks to a smaller drivetrain system. Because the system is more compact, engineers could push the air-conditioning unit into the front motor compartment, saving room in the cabin. A flat floor further opens cabin space.
Moreover, new electric drivetrain technology delivers longer range and sportier acceleration.
The Ariya offers two batteries, a 65-kilowatt-hour system and a 90-kWh version. Both are improvements over the Leaf’s 62-kWh pack. The Ariya will come in two layouts: a one-motor, two-wheel-drive version and a two-motor, all-wheel-drive variant called e-4orce. Nissan promises a range of up to 300 miles for the 2wd version with the bigger battery. The e-4orce awd version, meanwhile, will sprint as fast as Nissan’s racy Z sporty coupe, the company says.
Spunkier acceleration comes from a bigger electric motor that has a higher rate of maximum rotation. The new motor churns out 160 kilowatts from the small battery and 178 kW from the big one.
At the same time, a new lithium ion battery achieves higher energy density to help extend the range. It replaces the Leaf’s graphite anode with a silicon-graphite one. And to help reduce cost, the new cathode dials up the use of less expensive nickel and reduces the use of pricier cobalt and manganese.
The battery pack also adopts a lightweight aluminum frame over the steel frame used in the Leaf. Finally, the new battery has a more effective liquid-cooled system instead of the Leaf’s air-cooled structure.
Nissan isn’t disclosing the name of its battery supplier yet or revealing where its cells are made. But the packs are assembled near Nissan’s Tochigi plant north of Tokyo, where it will make the Ariya for Japan and global markets. Nissan spent about $310 million last year to modernize the factory, best known for the GT-R and 370Z sports cars, to manufacture EVs as well.
In addition to its new powertrain, the Ariya will be packed with other costly technology, including Nissan’s ProPilot Assist 2.0 driver-assistance system and the latest connectivity systems.
But all those goodies lift the vehicle’s starting price to about $40,000, and the sticker may climb rapidly higher for the top-tier awd variants with the big battery. That represents a significant jump over the expected $26,000 entry point for the just redesigned gasoline-powered Rogue crossover.
But the Ariya’s mission is to lift the brand as much as its sales volumes, COO Ashwani Gupta said. “For us today, the product will drive the brand, not the brand drive the product,” he said.
The Ariya headlines Nissan’s new “A to Z” marketing campaign, which the company hopes will refocus customers on Nissan’s upcoming products after the sordid arrest of former Nissan and Renault Chairman Carlos Ghosn threw the companies and their partnership into chaos for much of the past year and a half.
The “Z” stands for a next-generation Z car that was previewed Wednesday, Sept. 16.
Whereas the first-generation Leaf was simply meant to establish a presence in the EV market, and the second generation focused on improving performance, the Ariya aims to build the image and generate buzz. In the U.S., Nissan hopes it plays a critical role in the drive for what it has been calling “quality sales.”
“This is the flagship of our new Nissan,” Gupta said. “We have to demonstrate the capacity of Nissan to go to the next generation. We have to graduate from a ‘good brand’ to a ‘great brand.’ We can only make it by three things — demonstration of new products, demonstration of new technology and discipline in the way we do the business. It’s very simple.”
Uchida said the Ariya’s early unveiling — a year before starting sales in the U.S. — was meant to give Nissan time to telegraph the vehicle’s value and have customers warm to the upmarket move.
Nissan insists customers worldwide are more interested in EVs and that technological improvements are putting range anxiety in the rearview mirror. But the company also is more circumspect now than it was when it brought the Leaf to market and launched three assembly plants around the world to build the vehicle.
For now, Tochigi will be the sole source of the Ariya, though a plant in China may someday come online.
Gupta declined to give a sales target for the new model but clarified that it won’t be a volume player like the Sentra, Rogue or Altima.
SBI Securities’ Endo predicted global deliveries of just 30,000 a year. Inovev, an automotive market research group, predicts 50,000 sales annually.
Under its Nissan Next business plan, the automaker wants to ramp up to selling 1 million electrified vehicles in the fiscal year ending March 31, 2024. But the large majority of those are not expected to be full battery-electric vehicles, but rather vehicles equipped with Nissan’s e-Power series hybrid system.
Since launching the first EV in 2010, Nissan has sold 482,000 Leafs, bringing its cumulative global total of EV sales to 640,000 through July.
The new CMF-EV platform will make it easier for Nissan and Renault to spread volume across the alliance, said Ivan Espinosa, Nissan’s senior vice president in charge of global product planning.
“There’s a lot of flexibility that allows the platform to provide a wide spread of choice for the companies,” he said. “You can play with the wheelbase. You have specific tuning of the powertrain, you have specific tuning for the chassis elements. We will keep building on this architecture. You can think of doing cars a bit larger, which could come to the U.S. eventually.”
Espinosa said the U.S. is warming to electrification, but customer tastes are changing. Buyers want vehicles every bit as mean as they are green. Thus, the U.S. marketing message for the Ariya will be centered on “confidence” and “excitement,” Espinosa said.
“Excitement of driving is a selling point,” he said. “What can be really appealing to a U.S. buyer is the joy of driving an EV, the acceleration you get, the excitement of driving these cars.”
But Nissan now faces a rush of new EV competition from well-endowed companies, including Tesla, Volkswagen and General Motors. Even EV skeptic Toyota plans to get into the game.
But Nissan executives say that surge in competition is proof that EV demand is finally reaching a critical mass.
Since unveiling the Ariya in mid-July, Nissan says the vehicle has attracted more than 35,000 hand- raisers worldwide. The U.S. has the second-highest number, behind Japan.
“This is the most advanced car that Nissan has done in its history,” Espinosa said. “Customers are starting to be much more interested in these technologies. There is no doubt about it.”
Peter Sigal contributed to this report.