Nissan will cut battery manufacturing due to slow demand for electric cars

Article by Christian A., on September 19, 2014

Nissan builds its own electric-vehicle batteries through a joint venture with NEC Corp. But since chief executive Carlos Ghosn is bent on reducing in-house battery making, the carmaker may soon order EV batteries from LG Chem or eventually from other suppliers. "We will have both, and I hope even more," Ghosn said.

While the joint venture – AESC – currently builds batteries for Nissan, Ghosn is also exploring an agreement wherein LG Chem would build power packs at the carmaker’s sites in the United Kingdom or the United States, a source told Reuters. Nissan’s plan entails phasing out production at its plants in the UK and in the US while cutting down output of next-generation batteries at its site in Japan, two alliance sources told Reuters.

The sources added that Nissan would follow the lead of alliance partner Renault in ordering cheaper batteries from LG Chem for some future vehicles. One executive at Nissan told Reuters that while the carmaker wanted to be a leader in battery manufacturing, such operations has become less competitive than initially planned.

He noted that AESC is still between six months and a year behind LG in price-performance terms. The sources disclosed that a decision on Nissan’s battery plants in the UK and the UK will be out in October, following a tense procurement review with Renault.

Another source said that while Renault would prefer to outsource its EV batteries, Nissan engineers would prefer to stay in-house. "The write-off costs are potentially huge," the source noted.

Alliance spokeswoman Rachel Konrad, however, said that that Renault-Nissan is still fully committed to its EV program and is not planning write down battery investments.

She remarked that the alliance has not made any decision over battery sourcing allocation. Despite the remarks, the sources told Reuters that Nissan is already in talks with NEC Corp. on the shift to dual sourcing.

Topics: nissan, electric car

If you liked the article, share on:

Comments

Recommended

One of the executives at Volkswagen tagged in the so-called Dieselgate scandal has pleaded not guilty to a list of allegations surrounding the carmaker’s actions to cheat emissions regulations in...
by - February 27, 2017
When the Crown De Luxe saloon was first released in 1972, it was at that time the most lavish Toyota model available to British customers. Both unusual and exclusive, one...
by - February 27, 2017
The ride-sharing fleet of sharing Lyft Inc. will soon include thousands of specially fitted self-driving Chevrolet Bolt electric vehicles, courtesy of General Motors. If plans push through, Lyft’s clients would...
by - February 27, 2017
J.D. Power has officially released the 2017 Vehicle Dependability Study, an annual list of the most dependable brands in the auto industry. Once again coming on top is Lexus, the...
by - February 26, 2017
Citroen revealed that its entry to the Chinese market is moving forward with the planned release of the new generation C5. While still on sale on this part of the...
by - February 26, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries