A big chunk of the $1.6 billion loan that Nissan North America received from the U.S. government will pay for a lithium ion battery plant.
The plant will make the batteries and assemble them into ready-to-install modules.
"We wanted the battery plant as close to the manufacturing line for the vehicle as possible," Mark Swenson, Nissan North America's vice president of manufacturing engineering, told Automotive News. "The battery pack itself weighs around 500 pounds. So the closer we can get it to where it is installed in the vehicle, the better."
The assembly line in the Smyrna, Tenn., plant that builds pickup trucks and SUVs will be retooled for five-passenger electric cars. Nissan is targeting production of at least 100,000 electric vehicles a year as early as 2011 and 150,000 once the assembly line is running at full speed after 2012.
Nissan will be able to use much of the production equipment already in place, said Susan Brennan, Nissan's vice president of manufacturing.
Nissan could operate the battery plant itself or turn the job over to a partner. Nissan buys its electric-car batteries from a joint venture between the automaker and Japan's NEC Corp.
Nissan plans to start selling electric cars in the United States next year. The initial vehicles will be made at Nissan's Oppama plant south of Tokyo.
Initial sales will target fleet customers such as corporations and local governments, CEO Carlos Ghosn said after Nissan Motor Co.'s shareholders meeting in Yokohama, Japan. Nissan plans to offer three electric models.
"We have not finalized our plans yet, but I can tell you I am not at all worried about how to sell these cars," Ghosn said. "There is an appetite for zero-emissions cars."