Car maker and its parent Renault will manufacture both
Anthony Rowley, Business Times 20 Oct 09;
JAPAN'S second biggest car marker, Nissan, and its French parent Renault intend to sink a huge investment into producing batteries for electric cars in the belief that electric vehicles will account for 10 per cent of the global car market by as early as 2020, Carlos Ghosn, head of both companies announced last night.
He spoke on the eve of the Tokyo Motor Show where interest in electric cars is expected to be at an all-time high as concern over global warming and environmental pollution mounts around the world.
Nissan and Renault are taking a 'long-term bet' on electric cars and are distancing themselves from other leading motor manufacturers by deciding to manufacture both electric vehicles and the batteries that power them.
The electric car is 'no longer day dream - the technology allows it now', said Mr Ghosn, who is president and CEO of Nissan and chairman and CEO of Renault.
The era of 'cheap oil is ending', declared Mr Ghosn, and oil prices, already at US$78 a barrel can only rise as economic recovery sets in and demand for energy rises. Electricity to power motor vehicles, on the other hand, can be generated from oil, coal, nuclear, solar and other sources, he noted.
Other leading motor manufacturers plan to 'buy' batteries from outside, but battery makers are wary of sinking major investment into producing them without a guarantee of future demand, Mr Ghosn said. Nissan and Renault can overcome this problem by producing both, he claimed.
'Our intention is to be a big player in the industry,' Mr Ghosn told the Foreign Correspondents' Club of Japan. 'The investment is very costly', but Nissan and Renault believe it will be justified in view of the potential for electric cars.
China has developed technologies for producing 'relatively' cheap car batters, while Japan and South Korea have the ability to produce high power electrical energy sources, said Mr Ghosn. Nissan hopes to take advantage of both technologies.
Future car growth will come mainly from emerging markets such as China, India, Brazil and Russia, Mr Ghosn said, but initial demand for electric cars will come chiefly from the US, European and Japanese markets.
Governments are anxious to see a significant switch to electric powered vehicles and are willing to invest in the battery-charging infrastructure needed to support the introduction of such vehicles on a major scale, he said.
Nissan is currently negotiating with governments in 30 countries around the world with a view to agreeing on such infrastructure building, Mr Ghosn noted.
Nissan will begin an 'offensive' to market electric cars in the US market next year, followed by similar drives in Japan and Europe, where Renault will be a source of supply, he said. The fact that most electric cars can cover a maximum of 160 kilometres before needing their batteries charged is no barrier to their mass use, the Nissan president and CEO claimed. In the US, most car owners drive less than 100 kilometres a day and in Japan less than 50.
The cost of providing charging and recharging infrastructure for electric car batteries is far from prohibitive, at both the household and community level, he said. And, the electric car is more energy-efficient than conventional motor engines, he added.
