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cwerdna

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http://finance.yahoo.com/news/exclusive-nissan-faces-battery-plant-060958496.html" onclick="window.open(this.href);return false; has a lot of interesting anecdotes and claims...
PARIS (Reuters) - Nissan boss Carlos Ghosn is preparing to cut battery manufacturing, people familiar with the matter said, in a new reversal on electric cars that has reopened deep divisions with alliance partner Renault (RENA.PA).

The plan, which faces stiff resistance within the Japanese carmaker, would see U.S. and British production phased out and a reduced output of next-generation batteries concentrated at its domestic plant, two alliance sources told Reuters.
...
A decision on the Nissan battery plants in Sunderland, England, and Smyrna, Tennessee, is due next month, the sources said, following a tense procurement review with 43.4 percent shareholder Renault, the smaller but senior partner in their 15-year-old alliance.
It'll be interesting to see what happens, if anything, next month.
 
Certainly the fact that Renault has been using rival LG for batteries must strain the relationship.

At the same time, does Japan have enough capacity to handle worldwide demand?

The DOE loans Nissan used to build the Smyrna plant might be an issue, too.
 
drees said:
Certainly the fact that Renault has been using rival LG for batteries must strain the relationship.
Indeed... the LG, NEC, Renault, Nissan issue/relationship sounds complicated and could create a sticky situation.
 
The cost of building the battery manufacturing plant was always a large fixed cost that did not scale with production volumes. Without the ability to fill those factories, it becomes quite difficult to pay for them.

I'm wondering if this situation in any way influenced Andy Palmer's departure.
 
A couple of points:

--"Nissan faces battery plant cuts as electric car hopes fade" - what a misleading headline. Electric car hopes aren't fading, it's just that the actual uptake (which is faster than the Prius) is not the pie-in-the-sky projection on which the battery factories were based.

--"Nissan later cut prices, settled a class action and offered retroactive warranties to answer customer concerns about battery deterioration." If this is the level of "information" in the article, take it with a grain of salt. The class action isn't settled, it is in mediation.
 
The cost of building the battery manufacturing plant was always a large fixed cost that did not scale with production volumes.

This statement bothers me, given that Tesla's Gigafactory is entirely based on reducing costs due to volume manufacturing and vertical integration.

John Petersen, the eternal troll is going to have a field day taking yet another pot shots on Tesla with this news
 
mkjayakumar said:
This statement bothers me, given that Tesla's Gigafactory is entirely based on reducing costs due to volume manufacturing and vertical integration.
The idea of a "Gigafactory" is to reduce PER-UNIT costs. The capital outlay required to build such a "Gigafactory" will still necessarily be enormous. If they can fill it with battery production, then it should be able to pay for itself.

In the case of Nissan, it seems they are a long way from paying for their factories even with the government incentives that they were given.
 
drees said:
At the same time, does Japan have enough capacity to handle worldwide demand?

The DOE loans Nissan used to build the Smyrna plant might be an issue, too.
The article suggests that they may bring LG tech into the battery plants Smyrna and UK plants, so perhaps this might not be an issue. But LG also has quite a bit of (currently) unused capacity up in Michigan.

Interesting to know that LG is 15-20% cheaper - but then they also say that they're only 6-12 months behind in price-performance. Does that mean that price-performance is currently falling 15-20% a year?

That would be significantly faster than the oft-referenced 7-8% / year annual reduction in price-performance.
 
One piece of this article that grabbed my attention was regarding the politics

Many of the past missteps can be traced to internal rivalries of the kind Ghosn is only now moving to stamp out.

Former Nissan second-in-command Carlos Tavares, racing to beat the Renault Zoe to market, cut Leaf development by a year and skipped a critical battery redesign, according to alliance veterans. Nissan later cut prices, settled a class action and offered retroactive warranties to answer customer concerns about battery deterioration. Tavares now heads PSA Peugeot Citroen.

His Renault archrival at the time, Patrick Pelata, signed a confidentiality deal with LG that meant Nissan battery engineers never even knew what they were up against.

Against that backdrop, the atmosphere may be charged when Nissan engineering boss Hideyuki Sakamoto puts final arguments against the outsourcing plan in a presentation to Ghosn as soon as this week.

With Andy Palmer leaving recently it does seem there is a considerable shake up or disquiet at Nissan going on. Both Pelata and Tavares both left Nissan/Renault a few years back. It seems Tavares quit and came back.
http://online.wsj.com/news/articles/SB10001424127887323324904579042373238456420
http://autoweek.com/article/car-news/renault-spy-scandal-former-coo-had-leave

Interesting that in the Reuters article they referred to the battery degradation issues and the fact they may have skipped an important tech upgrade to get the product out at the same time as the Volt and to beat the Zoe. Hmmm..... How much of this actually happened and how much is rumor and speculation may never be known.

Ghosn must be a tough guy to work for. Which isn't necessarily a bad thing.
 
drees said:
Certainly the fact that Renault has been using rival LG for batteries must strain the relationship.
Bad call on Nissan's part to initially produce that inferior battery. :(
Now an uphill battle to reprove themselves.
 
might be delayed , or might come on time and just have no real battery improvement, only the body styling and interior fix up.......

hard to say .. I do think this cements the 2016 model as having few changes possible beyond minor trim and infotainment

I took a 2 day I3 test drive and had fun with the i3 quick accell and handling. they are piling up on dealer lots here as I predicted and are heavily discounted......
I just may flip into one when my lease is up in January
 
KJD said:
Does this mean that LEAF version 2.0 will be delayed ?

Who knows!?!

It certainly throws the cat amongst the pigeons.

The tragedy is that with the announcement of the Tesla Gigafactory, it does seem that Nissan was ahead of the field by in-sourcing battery manufacturing to keep costs down. Great strategy, they simply failed in execution.
 
Bit more information here:

http://finance.yahoo.com/news/nissan-may-purchase-lg-batteries-152129426.html" onclick="window.open(this.href);return false;
 
mkjayakumar said:
The cost of building the battery manufacturing plant was always a large fixed cost that did not scale with production volumes.

This statement bothers me, given that Tesla's Gigafactory is entirely based on reducing costs due to volume manufacturing and vertical integration.

John Petersen, the eternal troll is going to have a field day taking yet another pot shots on Tesla with this news

Here is another angle.
Because of the slower uptake, a Nissan is finding it cheaper to buy battery packs from Tesla for its next gen Leaf. At the same time, this will also facilitate the next gen Leaf having access to the supercharger network.

Pure conjecture of course. Nissan seems very dedicated to EVs though. So I would not necessarily equate a pull back in their battery production to a pull back from EVs.
 
I don't think Nissan will be buying packs from tesla. I've spoken to a few of the top people at Nissan and they do not like the chemistry. They think it is too volatile and unsafe. (I very much disagreed with them...)

Remember that "open letter" posted to Leaf owners in 2012 about how the batteries were degrading "as expected"? It was penned by Carla Bailo who was head of the R&D facilities in Arizona and Michigan. She left or was let go from Nissan in March.

It looks like there's a shakeup going on at Nissan. Good.
 
JeremyW said:
It looks like there's a shakeup going on at Nissan. Good.

As long as it is the right people being shaken up and not scapegoats.

Tavares is still with Renault in a top job. If the Reuters article has any validity, it would seem he is the most culpable having skipped a tech upgrade to meet an arbitrary deadline.
 
That volatility of the Tesla S battery pack is an open question. I don't know when the sample size is large enough to show a difference but Tesla S has had a number of battery fires and as far as I know the LEAF has had none. And having the added complexity and cost of a cooling system compared to a passive system. If BEV are to be mainstream, Nissan is on the right track with lowering cost, keeping it simple and most of all, making it safe.


JeremyW said:
I don't think Nissan will be buying packs from tesla. I've spoken to a few of the top people at Nissan and they do not like the chemistry. They think it is too volatile and unsafe. (I very much disagreed with them...)

Remember that "open letter" posted to Leaf owners in 2012 about how the batteries were degrading "as expected"? It was penned by Carla Bailo who was head of the R&D facilities in Arizona and Michigan. She left or was let go from Nissan in March.

It looks like there's a shakeup going on at Nissan. Good.
 
The LEAF, hitting the market the way it did, when it did, did a lot of good. This is my early-adopter opinion. But you all are telling me, they were one year away from having a more durable battery. Well, it's been four years now, and not much has changed. So I'm politely calling that one, "folklore".
 
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