Nissan’s chairman and CEO said electric vehicles are the way of the future in a keynote address to the International Motor Press Association at the start of the New York Auto Show. Carlos Ghosn, leader of the Renault-Nissan Alliance noted it had sold more than 300,000 EVs globally – not as much as expected, but a healthy start.
Ghosn says – not without abundant self-interest as a leader in the EV segment – that more needs to be done to promote EV sales and plug-in access.
“Nearly every major automaker has ambitious (EV) projects underway. I expect the global auto industry to see more changes in the next five years than it has in the last 20. And those changes will bring tremendous opportunities for those companies with the skills and foresight to seize them. It’s clear EVs are here to stay,” Ghosn said.
However, there are uncertainties across the entire industry:
- What regulatory roadblocks will emerge?
- What role will tech companies play?
- Which of our companies will succeed or fail in addressing the coming wave of change?
- And which will be able to move quickly and adapt in such a rapidly changing technological landscape?
‘I don’t pretend to know all the answers to these questions. But rather than fear the disruption, I believe our industry really has no choice but to embrace it,” Ghosn said.
Indeed, the need for technical innovation is imperative. The US Environmental Protection Agency – with agreement of the automakers – set a target of 54.5 miles per gallon in 2025, but in an ‘escape clause’ automakers negotiated, the regulation set 2017 as a so-called mid-term review where the standard could be adjusted down.
The Alliance of Automobile Manufacturers is already lobbying for a reduction in the regulation. So far the results in terms of fuel economy are considerable: From 2002 to 2014 automakers have achieved a 26% increase in fuel efficiency through investments of billions in fuel-sipping features.
But Ghosn cautioned that the automakers are not moving fast enough to reduce emissions of greenhouse gases posing grave risk to the planet. It’s ironic that as a member of the Alliance of Automobile Manufacturers his company is working to weaken fuel economy regulations, which would increase greenhouse gases because CO2 output directly correlates with fuel economy. His Renault-Nissan continues to pursue EVs, with the Nissan LEAF leading in the U.S. despite under-forecast sales. Nonetheless, LEAF has more than 200,000 owners and one of the top Nissan vehicles in customer satisfaction.
Fuel economy regulations are the biggest challenges automakers face.
“Predicting the production readiness and cost of a plethora of fuel-saving technologies out to 2025 is a formidable task with inherent uncertainty,” Jay Baron, Center for Automotive Research president and CEO. “The mid-term review (2017) provides a critical safety net for the industry to gauge progress and evaluate the need for adjustments to the CAFE ruling. To ensure that the government is well-informed on numerous technological options at the mid-term review and even beyond 2025, the knowledge-gathering process is rigorous and relies on the expertise of numerous stakeholders.”
Ghosn cited several reasons why he is bullish about EVs’ future:
- To deal with the threat of climate change, the world is demanding that our industry invest more in zero-emissions transportation;
- Governments around the world are imposing stricter limits on CO2 emissions … and one major response has to be electrification;
- But beyond environmental regulation, EVs just make sense.
“We have already seen within the Renault-Nissan Alliance how the cost of EVs continues to go down as their economies of scale begin to inch closer to those enjoyed by the internal combustion engine, Ghosn said.
“EVs are also relatively simple machines: A battery and electric motors. They require far less service, no oil changes and they are extremely reliable. With battery technology improving and the charging infrastructure expanding in much of the world, we are nearing the turning point where EVs will become more mainstream,” Ghosn claimed.
However, the two biggest press conferences Nissan staged during the New York International Auto Show were for gas guzzlers. The manufacturer will need to sell many more LEAF models (126 mpg city/ 101 hwy / 114 combined) – caveat here these are not the numbers used to calculate CAFE – and Sentra compacts (29 city / 38 hwy / 32 combined) to balance the poor fuel economy of other high powered models.
The 2017 Nissan TITAN Crew Cab half-ton pickup, unveiled at the show, will be powered by a new 390-horsepower 5.6-liter V8 gasoline engine which is shared with the new Armada SUV. The 2wd Titan is EPA rated at 13 city / 18 hwy / 15 combined. The old Armada was EPA rated at 13 city / 19 hwy / 15 combined. The Nissan GT-R has a 3.8-liter V6 24-valve twin-turbocharged engine rated at 565 horsepower at 6800 rpm and 467 lb.-ft. of torque. The old GT-R was EPA rated at 16 city / 22 hwy / 19 combined.
On balance, Nissan also invited journalists to test drive its new four-foot wide, seven and a half-foot long vehicle called the New Mobility Concept. It comes out of Nissan’s Future Lab, a small think tank in Silicon Valley that has studied mobility questions since 2014.
The one-seater concept vehicle is a cross between a car and a moped weighing just over 1,000 pounds It is based on the Renault Twizy and selling in targeted European markets for just under $10,000. With a 17-hp electric motor, a 6.1 kWh lithium ion battery it has a 40-mile range and a top speed of 25 miles an hour. While sexier than a golf cart, it could be the perfect urban commuting vehicle.
Rachel Nguyen, director, Nissan Future Lab told media: “With the fast-paced growth of smart technologies and the emergence of the sharing economy, we are studying how this size and package of electric vehicle fits in real life customer situations.”
Will the future be mini-sized vehicles that rent by the hour or will the future be TITAN trucks? Ghosn is pragmatic: “We can make some educated guesses and calculated bets – and we have – but in the end customers will decide which technologies and business plans will survive.”