Ghosn on CNBC talking about 2013 Leaf

[jeremyz]

http://video.cnbc.com/gallery/?video=3000082349&play=1" onclick="window.open(this.href);return false; (about 1 minute in)

He said there's going to be a huge drop in production costs for the Leaf once it's built in the U.S. and that he's expecting a spike in sales in September. The CNBC guy asks how much the price of the car is going to drop, and then Ghosn backpeddles saying that there's going to be very little change in the price that the consumer sees. To me, it sounds like they're going to lower the price of the 2013 Leaf.

 

[thankyouOB]

production costs less
price remains similar
=
more $$ for Ghosn.

--------------------------------------------------------------------------------
(update: For those who misread this -- as per below; this is not a criticism. it is a factual statement.)

 

[TRONZ]

Well it's a given that Nissans margins are going to go way up with Tenn built LEAFs. I am far more interested in what EV products are being planned for production in Tenn. Thats a rather large battery facility and Ghosn is not stupid.

 

[LTLFTcomposite]

production costs less
price remains similar
=
more $$ for Ghosn.

I won't begrudge them a profit; they aren't in this for the fun of it.

Near as I can tell they are swimming in red ink here. They need to right the ship or the program won't last.

 

[TRONZ]

Actually Europe is the biggest concern for Nissan right now. But yes, the Dollar/Yen is beating them up badly here. With general Nissan demand high in the U.S., this is what's known as a "good problem".

It sounds to me like Ghosn has been very busy re-aligning component supply costs to offset currency issues. When a CEO talks about sales/production being triggered in 6 months then it's all because of component costs, fabrication technology, contracts, etc, behind the scenes.

The core advantage here is that people clearly know which way Ghosn is rowing and why. Trust goes a long way.

 

[gsleaf]

To me, it sounds like they're going to lower the price of the 2013 Leaf.

I think you may be right. He certainly can't come out and tell everyone the price will be dropping otherwise it might hurt 2012 sales, but who knows. Seems to me there has to be some driver for increased sales.

Only possibilities I see for increase sales:
1. Decreased price.
2. Increased range.
3. Increased availability (if you believe that the only thing holding sales back is the lack of inventory)

Does anyone know how much Nissan will save between shipping costs and currency differences for a Leaf built in the US? I'm excited to hear they expect more sales in September. Hopefully that means the 2013's will be ready to order by then.

 

[EdmondLeaf]

here is your price drop

http://gas2.org/2012/04/03/nissan-considering-battery-lease-option-for-leaf/

 

[TRONZ]

here is your price drop

http://gas2.org/2012/04/03/nissan-considering-battery-lease-option-for-leaf/

I always liked this idea. Not sure why Nissan did not try it from the start.

 

[lpickup]

To me, it sounds like they're going to lower the price of the 2013 Leaf.

or....the price will remain the same but the new 6.6kW charger and upgraded heating system will be included in that price.

Are people thinking those are somehow going to be "free" items?

 

[smkettner]

Sounds like there will be no big marketing push until Leaf rolls off the line in TN at YE2012.
Due to the exchange rate there will be no push to sell Japan built Leaf in the US.
I would not buy a Leaf if a battery lease was required.

 

[TomT]

It sounds more like they are going to keep the price the same but increase their profit (or perhaps actually MAKE a profit for the first time)...

To me, it sounds like they're going to lower the price of the 2013 Leaf.

 

[Nubo]

No doubt Nissan is losing money on US LEAF sales currently. That would be consistent with Ghosn's comments re: 2013 production costs vs. msrp. Riding out a period of losses until production facilities can make it profitable. Hasn't that been the plan all along?

 

[adric22]

I bet if the MSRP drops by even one or two thousand dollars, and they are sitting on every Nissan dealers lot, that will go a long way to spur sales. I think that is why Nissan has been hesitant to ship that many to the USA right now is because the profit margin issue.

 

[Herm]

here is your price drop
http://gas2.org/2012/04/03/nissan-considering-battery-lease-option-for-leaf/

In Europe, it may not be legal in many States due to Nissan selling you a car that does not run (without the optional battery)

 

[TRONZ]

Well there certainly does not appear to be a financial advantage to delivery alot of LEAFs to U.S. homes right now. The long view does seem to be in play with Ghosn.

I am sure any batt lease would be a finacial/paperwork option and no car would be delivered that was not drive ready.

 

[SanDust]

He made clear that the plan is to sell 20,000 units this year, and his explanation is that there is huge wave of unmet demand which Nissan will meet when the battery is made in the US starting in September and Nissan's costs drop.

Holding back until the costs drop makes perfect sense, but what evidence is there of all this pent up demand? Maybe there are some large fleet sales we don't know about.

 

[DaveEV]

He made clear that the plan is to sell 20,000 units this year, and his explanation is that there is huge wave of unmet demand which Nissan will meet when the battery is made in the US starting in September and Nissan's costs drop.

Holding back until the costs drop makes perfect sense, but what evidence is there of all this pent up demand? Maybe there are some large fleet sales we don't know about.

Seems pretty clear that Nissan plans on dropping the price with US production. They are probably barely making money on each LEAF sold as it is (if not losing money) - which is why they've basically been limiting sales to cars that people order directly from Nissan and bumped the price up significantly for the 2012 models.

Inventory levels are still very low for sales volume. With less than a 30 day supply, it's pretty clear that they could put a lot more LEAFs on dealer lots and that alone would bump up sales. I doubt this would be enough to get sales significantly higher than 1,000 / month, though.

To get the rest of the way to 20,000 cars a year, they will have to drop the price. I'd expect to see prices go back down to the original 2011 price - and perhaps widen the price range by removing/adding features and trim lines.

Now to make the most of the rest of their EV capacity, Nissan is going to need more plug-ins. The Infiniti will be one - I wonder what other tricks they have up their sleeves...

 

[coqui]

Sounds like a good idea to me
http://www.betterplace.com/" onclick="window.open(this.href);return false;

here is your price drop

http://gas2.org/2012/04/03/nissan-considering-battery-lease-option-for-leaf/

 

[GaslessInSeattle]

the way I heard it, Carlos is saying that they have been holding back on production because of the cost due to the yen. By moving to the US, it will lower the production cost and allow Nissan to go into full production... I didn't hear any implication of a price drop for the consumer in that. my guess is that right now they are selling the car at a loss.

To me, it sounds like they're going to lower the price of the 2013 Leaf.

or....the price will remain the same but the new 6.6kW charger and upgraded heating system will be included in that price.

Are people thinking those are somehow going to be "free" items?

 

[TRONZ]

I wonder what other tricks they have up their sleeves...

Well NY city is also getting an EV version of the NV Taxi. With Infiniti and LEAF thats three. Plus whichever car Nissan picks for production between Townpod, Pivo and EsFlow, that will make four.