Nissan says cheaper U.S. Leaf price due to tax, incentive gaps
Skip to main content
Sister Publication Links
  • Automotive News Canada
  • Automotive News Europe
  • Automotive News China
  • Automobilwoche
AN-LOGO-BLUE
Subscribe
  • Subscribe
  • Account
  • login
  • HOME
  • NEWS
    • Dealers
    • Automakers & Suppliers
    • News by Brand
    • Cars & Concepts
    • Final Assembly
    • China
    • Shift
    • Mobility Report
    • Special Reports
    • Digital Edition Archive
    • This Week's Issue
    • Dan Parker will pilot his Chevrolet Corvette with a custom guidance system that provides audible feedback.
      Blind racer gets Cruise support, but he'll drive
      You may have won! But no
      The course was planned for a Vermont ski resort, until neighbors shouted the idea down.
      Off-road course for Broncos? Not in my backyard
      The 1965 Mustang Shelby GT350 reigned supreme in the Ford Frenzy tournament.
      Shelby GT350 gets its one shining moment
    • Huawei
      Huawei to invest $1 billion on auto technology
      GAC Motor Co. launched sales of a new full electric crossover, the Aion Y, in March.
      New-vehicle sales rebound 75% in March from virus-hit 2020
      Wuling launched sales of its first pickup, the Zhengtu, on March 18.
      GM Q1 sales rebound but fall short of pre-COVID level
      The Ford Equator SUV arrived in the Chinese market on March 28
      Ford Q1 sales surge 73% over virus-hit 2020
    • Udelv CEO offers a historical perspective on high-tech goods delivery
      Q&A with BrightDrop CEO Travis Katz
      Automakers optimize manufacturing, customize products through digitization
      3D-printing a Porsche: Making concepts matter
    • WeRide China.jpg
      Nissan-backed startup gets OK to test driverless vehicles in U.S.
      Mobileye Udelv
      Intel's Mobileye teams with startup Udelv on automated delivery
      Nuro Domino's
      Domino's, Nuro to start robot pizza delivery in Houston
      Cruise Origin
      Cruise to deploy robotaxis in Dubai from 2023
    • Elon Musk interview
      Tesla’s Model Y, on sale since March, is a showcase of EV technologies competitors will benchmark.
      Technologies of Electrification
      Cadillac’s Lyriq EV will be unveiled Aug. 6.
      Future Product Pipeline
      A CALL TO ACTION
    • Ad process evolves with pandemic
      Pandemic adds resonance to Garff effort
      Microchip illustration
      The latest numbers on the microchip shortage: GM production pummeled
      Moreno sets sights on Washington
    • Access F&I
    • Fixed Ops Journal
    • Marketing
    • Used Cars
    • Retail Technology
    • Sales
    • Best Practices
    • Dealership Buy/Sell
    • NADA
    • NADA Show
    • Automakers
    • Manufacturing
    • Suppliers
    • Regulations & Safety
    • Executives
    • Talk From The Top
    • Leading Women Network
    • Guide to Economic Development
    • PACE Awards
    • Management Briefing Seminars
    • World Congress
    • Aston Martin
    • BMW
      • Mini
      • Rolls-Royce
    • Daimler
      • Mercedes Benz
      • Smart
    • Ford
      • Lincoln
    • General Motors
      • Buick
      • Cadillac
      • Chevrolet
      • GMC
    • Honda
      • Acura
    • Hyundai
      • Genesis
      • Kia
    • Mazda
    • McLaren
    • Mitsubishi
    • Nissan
      • Infiniti
    • Stellantis
      • Alfa Romeo
      • Citroen
      • Chrysler
      • Dodge
      • Ferrari
      • Fiat
      • Jeep
      • Lancia
      • Maserati
      • Opel
      • Peugeot
      • Ram
      • Vauxhall
    • Renault
    • Subaru
    • Suzuki
    • Tata
      • Jaguar
      • Land Rover
    • Tesla
    • Toyota
      • Lexus
    • Volkswagen
      • Audi
      • Bentley
      • Bugatti
      • Lamborghini
      • Porsche
      • Seat
      • Skoda
    • Volvo
    • (Discontinued Brands)
    • Virtual reveals (Sponsored)
      • MITSUBISHI: 2022 Outlander
      • NISSAN: 2022 Pathfinder and 2022 Frontier
      • GENESIS: 2021 GV80
      • KIA: 2021 K5
      • LEXUS: 2021 IS
      • NISSAN: 2021 Rogue
      • TOYOTA: 2021 Venza and 2021 Sienna
    • Auto Shows
    • Future Product Pipeline
    • Photo Galleries
    • Car Cutaways
    • Design
  • OPINION
    • Blogs
    • Cartoons
    • Keith Crain
    • Automotive Views with Jason Stein
    • Columnists
    • China Commentary
    • Editorials
    • Letters to the Editor
    • Send us a Letter
    • Mach-E
      For Ford, 3rd-party charging network must improve to reap Mustang Mach-E potential
      VW logo with reflection
      VW lied to sell diesels; now it lied to sell EVs
      265725_XC90_Inscription_in_Birch_Light.jpg
      Volvo targets top talent in U.S., China with generous parental leave policy
      The new Stellantis pickup: Schrödinger's Dakota
    • In case of supply chain woes, break glass
      Quick! The Biden phone
      VW's Joke Is On You
      Joke Is On You
      In case of supply chain woes, break glass
      view gallery
      3 photos
      Leo Michael Cartoons - Q2 2021
      Leo Michael: There's Nothing You Can Do!
      Nothing You Can Do
    • Shifting gears away from the stick shift
      SEMA still a wonderful circus
      Penske still has plenty of races to win
      Ford's turn in the hot seat
    • April 13, 2021 | GM shows it’s serious about electric
      April 6, 2021 | For Volkswagen, authenticity is the only path forward
      March 30, 2021 | Tesla “changes” car industry
      March 23, 2021 | Remote work will continue after the pandemic
    • Jamie Butters
      EV rebates must work at retail
      Tracy Fred
      Dealers deserve access to their data
      Ford's Blue Advantage tool shows it's ‘listening' to dealers
      Dan Shine
      Service drive can lift dealerships as source of used-vehicle inventory
    • Why Xiaomi holds promise of becoming formidable EV player
      Geely’s new EV push is decidedly new age
      Charging poles installed outside a Tesla store in downtown Shanghai.
      Unreliable public EV charging sites prompt automakers to take wheel
      VW Group's playbook to dominate EV market
    • A step in right direction for Nissan dealers
      ‘Voltswagen' April Fools' gag far from funny
      Less is more in lineups as well as on lots
      Electric vehicle charger
      Electric vehicle hype opens door to short sellers
    • With EVs, bias for traditional carmakers
      ‘Voltswagen' was clever and fun
      Mixed-use plan a winner
      EV adoption in U.S. shouldn't be forced
  • DATA CENTER
  • VIDEO
    • AutoNews Now
    • First Shift
    • Special Video Reports
    • Weekend Drive
    • AutoNews Now: Biden eyes $50B for chip production, research
      AutoNews Now: EV battery decision looms for SK Innovation, LG Chem
      AutoNews Now: Ford skipping summer shutdown at many U.S. plants
      Mercedes leads Lexus, BMW in tight luxury race
    • First Shift: Ford dealers plan standalone Bronco stores
      First Shift: Hyundai to idle more output due to chip shortage
      First Shift: Biden's EV plan said to include $100B for consumer rebates
      First Shift: Stronger auto emissions rules coming by July, EPA head says
    • How a Seattle-area dealer is teaching, retaining auto techs 
      Virtual sales manager Jay Barger
      'Glued to a phone': Acura store's virtual sales boss lifts deliveries, efficiency
      One man’s journey from homelessness to thriving dealer
      Bert Ogden Auto Group
      How a Texas group is cutting costs, saving millions
    • Why the pickup is the auto industry's 'battleground'
      Carlos Ghosn's quest to restore his reputation
      Why Ford must execute to avoid 'deep trouble'
      Why Honda is 'locked and loaded' for 2020
  • EVENTS & AWARDS
    • Events
    • Awards
    • Congress Conversations
    • Retail Forum: NADA
    • Canada Congress
    • Europe Congress Conversations
    • Fixed Ops Journal Forum
    • Shift: Mobility at a Crossroads
    • 100 Leading Women
    • 40 Under 40 Retail
    • All-Stars
    • Best Dealerships To Work For
      • Register for the 2021 Best Dealership To Work For
    • PACE Program
    • Rising Stars
    • Europe Rising Stars
  • JOBS
  • AN Solutions
  • +MORE
    • Leading Women Network
    • Podcasts
    • Webinars
    • In the Driver's Seat
    • Publishing Partners
    • Classifieds
    • Companies on the Move
    • People on the Move
    • Newsletters
    • Contact Us
    • Media Kit
    • RSS Feeds
    • Shift: A Podcast About Mobility
    • Special Reports Podcasts
    • Daily Drive Podcasts
    • AAM
    • Cars.com
    • DealerPolicy
    • Gentex
    • IHS Markit
    • Remember Group
    • Reputation.com
    • Ricardo: Dave Shemmans
    • Ricardo: Marques McCammon
    • Allstate: Want more from your F&I?
    • Ally: Navigating the future of automotive retailing
    • Amazon Web Services: Any place, any time, any channel
    • Amazon Web Services: The power of the cloud
    • Amazon Web Services: Universal translator: Harnessing sensor data to build better automotive software
    • Capital One Auto: Dealerships remain vital to an increasingly digital car shopping journey
    • DealerSocket: 5 steps to modernizing the buyer's journey
    • Epic Games: Real-time tech is the next frontier of automotive
    • Epic Games: Transforming the auto industry with digital assets
    • FTI Consulting: Crisis as a catalyst for change
    • Google: 5 trends shaping the auto industry's approach to a new normal
    • Google: Google's dealer guidebook helps dealers navigate today's digital landscape
    • IHS Markit: Automotive loyalty in the wake of the COVID-19 recession
    • IHS Markit: COVID-19: The future mobility delusion
    • Level5: 2020 Automotive E-Commerce Report
    • Motormindz: Toward hyperconnectivity: 5 ways to position your business to profit from connected car
    • Naked Lime: Bring social reputation together as part of big-picture marketing
    • Wells Fargo Auto: Switching gears from LIBOR to SOFR
    • Ally: Do It Right
    • DealerSocket
    • Deloitte: Cyber everywhere: Preparing for automotive safety in the face of cyber threats
    • Facebook: The road to a zero-friction future
    • Guide To Economic Development
    • PayPal Credit: How consumer financing helps drive sales for online auto parts retailers
MENU
Breadcrumb
  1. Home
  2. Automakers & Suppliers
May 21, 2010 01:00 AM

Nissan says cheaper U.S. Leaf price due to tax, incentive gaps

  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    Nissan´s battery-powered Leaf, pictured, will cost about $37,000 in Europe after incentives.

    TOKYO (Bloomberg) -- Nissan Motor Co., aiming to be the biggest seller of electric cars, said a lower U.S. price for its Leaf hatchback compared with Japan and Europe reflects differences in local taxes and incentives and that the vehicle will eventually make money in all markets.

    Nissan said this week its battery-powered Leaf will cost about $37,000 in Europe after incentives. That compares with $32,780 in the U.S. before incentives and a base price in Japan of more than $40,000. Variations in import fees, taxes and incentives account for the disparities, said Tom Smith, Nissan's chief marketing manager for European electric auto sales.

    “If you just translate the U.S. price into euros, you seem to get a significant difference,” Smith said in a phone interview from Nissan's headquarters in Yokohama, Japan. Excluding Europe's higher tax on the vehicle and an import duty that's four times that in the U.S., “we are priced at exactly the same level in both markets,” he said.

    The Leaf, powered by a lithium-ion battery pack, will go on sale in Japan and the U.S. this year and in Europe next year. Nissan's CEOCarlos Ghosn has set a goal of leading sales of rechargeable vehicles, which he estimates may make up 10 percent of global auto demand by 2020.

    While competitors Toyota Motor Corp., General Motors Co. and Ford Motor Co. are preparing to sell battery-powered and plug-in hybrid models, none has announced plans matching Nissan's goal of being able to sell as many as 500,000 electric cars by 2012.

    Too low?

    Nissan aims for the Leaf to compete in price with Toyota's gasoline-electric Prius and Honda Motor Co.'s Civic Hybrid in the U.S. The vehicle qualifies for a $7,500 federal tax credit and may get an added $5,000 rebate in California, where large automakers are required to sell electric vehicles.

    Based on cost estimates for Leaf's battery pack, electronic components and production, the U.S. price seems too low, at least initially, said John Kluza, a battery analyst at Lux Research in Boston.

    The current cost of the 24-kilowatt-hour battery pack, capable of propelling the Leaf as far as 100 miles (160 kilometers), may be about $20,000, Kluza said. Nissan has declined to provide cost details.

    “It seems the goal was to price Leaf to get sales volume even if there's some initial loss,” Kluza said. “In the first year or so, perhaps they'll take a hit of $2,000 on each car, maybe more. Over time, as battery production scales up, that price will start to look more appropriate.”

    ‘All the information'

    The U.S. price excludes local sales taxes, which vary across the country, and a destination and handling charge of about $800, according to Jung.

    Takeshi Miyao, a Tokyo-based analyst for consulting company Carnorama, estimates battery-pack and component costs for the Leaf are about 2.45 million yen ($26,900), excluding labor and other expenses.

    Analysts such as Kluza and Miyao “don't have all the information,” said Nissan's Trisha Jung, chief marketing manager for U.S. electric vehicle sales, who oversaw local pricing for the model. “We are the first affordable, mass- market electric vehicle. We're pricing appropriately to ensure that.”

    Nissan is factoring into the price the longer-term impact of state and U.S. federal incentives it won to produce the Leaf at its Smyrna, Tennessee, plant and build a lithium-ion battery factory next to it, said KG Duleep, who researches advanced auto technologies for consultant ICF International. Those incentives included a $1.6 billion low-cost federal loan won in 2009.

    Advance orders

    “When automakers price, they build in all aspects of capital costs over a multi-year period, and Nissan is getting a substantial amount of assistance,” said Duleep, who is based in Washington. “There's probably some loss on the first few thousand cars, but perhaps by 2013 or so their costs might be at or below $30,000 a vehicle.”

    It took Toyota at least 10 years to make a profit on its Prius, which was introduced in 1997, when research, development and capital costs are included, said Koji Endo, managing director at Advanced Research Japan in Tokyo. It may take Nissan about the same amount of time, he estimated.

    For a new car powered by a conventional gasoline engine, it usually takes about four years to make a profit, he said.

    Nissan has a goal of 20,000 advance orders for the Leaf, which is set to begin arriving in the U.S. late this year. The company will mark the start of construction of its U.S. battery plant in Smyrna on May 26. The facility, to open in 2012, will have capacity to make lithium-ion battery packs for as many as 200,000 vehicles annually.

    RECOMMENDED FOR YOU
    Nvidia, Volvo Cars accelerate auto industry race for data-processing power
    Letter
    to the
    Editor

     

     

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Nvidia, Volvo Cars accelerate auto industry race for data-processing power
    Nvidia, Volvo Cars accelerate auto industry race for data-processing power
    Vietnam auto startup VinFast considering $2 billion U.S. stock offering, report says
    Vietnam auto startup VinFast considering $2 billion U.S. stock offering, report says
    On the baby front, Volvo takes the lead
    On the baby front, Volvo takes the lead
    Sponsored Content: IDC InfoBrief: Transforming aftersales with IoT
    Sign up for free newsletters
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    See more newsletter options at autonews.com/newsletters.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Digital Edition
    Automotive News 4-12-21
    THIS WEEK'S EDITION
    See our archive
    Fixed Ops Journal
    Fixed Ops Journal 4-12-21
    Read the issue
    See our archive
    BREAKING NEWS ALERTS: Sign up and be the first to know when big news breaks.
    WEEKLY NEWSLETTER: Sign up to start your week with the top stories from the latest issue of Automotive News, delivered to your inbox first thing each Monday morning.
    Get Free Newsletters

    Sign up and get the best of Automotive News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today

    Get 24/7 access to in-depth, authoritative coverage of the auto industry from a global team of reporters and editors covering the news that’s vital to your business.

    Subscribe Now
    Connect With Us
    • Facebook
    • Instagram
    • LinkedIn
    • Twitter

    Our mission

    The Automotive News mission is to be the primary source of industry news, data and understanding for the industry's decision-makers interested in North America.

    AN-LOGO-BLUE
    Contact Us

    1155 Gratiot Avenue
    Detroit, Michigan
    48207-2997

    (877) 812-1584

    Email us

    Automotive News
    ISSN 0005-1551 (print)
    ISSN 1557-7686 (online)

    Fixed Ops Journal
    ISSN 2576-1064 (print)
    ISSN 2576-1072 (online)

    Resources
    • About us
    • Contact Us
    • Media Kit
    • Subscribe
    • Manage your account
    • Reprints
    • Ad Choices Ad Choices
    • Sitemap
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Automotive News
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • HOME
    • NEWS
      • Dealers
        • Access F&I
        • Fixed Ops Journal
        • Marketing
        • Used Cars
        • Retail Technology
        • Sales
        • Best Practices
        • Dealership Buy/Sell
        • NADA
        • NADA Show
      • Automakers & Suppliers
        • Automakers
        • Manufacturing
        • Suppliers
        • Regulations & Safety
        • Executives
        • Talk From The Top
        • Leading Women Network
        • Guide to Economic Development
        • PACE Awards
        • Management Briefing Seminars
        • World Congress
      • News by Brand
        • Aston Martin
        • BMW
          • Mini
          • Rolls-Royce
        • Daimler
          • Mercedes Benz
          • Smart
        • Ford
          • Lincoln
        • General Motors
          • Buick
          • Cadillac
          • Chevrolet
          • GMC
        • Honda
          • Acura
        • Hyundai
          • Genesis
          • Kia
        • Mazda
        • McLaren
        • Mitsubishi
        • Nissan
          • Infiniti
        • Stellantis
          • Alfa Romeo
          • Citroen
          • Chrysler
          • Dodge
          • Ferrari
          • Fiat
          • Jeep
          • Lancia
          • Maserati
          • Opel
          • Peugeot
          • Ram
          • Vauxhall
        • Renault
        • Subaru
        • Suzuki
        • Tata
          • Jaguar
          • Land Rover
        • Tesla
        • Toyota
          • Lexus
        • Volkswagen
          • Audi
          • Bentley
          • Bugatti
          • Lamborghini
          • Porsche
          • Seat
          • Skoda
        • Volvo
        • (Discontinued Brands)
      • Cars & Concepts
        • Virtual reveals (Sponsored)
          • MITSUBISHI: 2022 Outlander
          • NISSAN: 2022 Pathfinder and 2022 Frontier
          • GENESIS: 2021 GV80
          • KIA: 2021 K5
          • LEXUS: 2021 IS
          • NISSAN: 2021 Rogue
          • TOYOTA: 2021 Venza and 2021 Sienna
        • Auto Shows
        • Future Product Pipeline
        • Photo Galleries
        • Car Cutaways
        • Design
      • Final Assembly
      • China
      • Shift
      • Mobility Report
      • Special Reports
      • Digital Edition Archive
      • This Week's Issue
    • OPINION
      • Blogs
      • Cartoons
      • Keith Crain
      • Automotive Views with Jason Stein
      • Columnists
      • China Commentary
      • Editorials
      • Letters to the Editor
      • Send us a Letter
    • DATA CENTER
    • VIDEO
      • AutoNews Now
      • First Shift
      • Special Video Reports
      • Weekend Drive
    • EVENTS & AWARDS
      • Events
        • Congress Conversations
        • Retail Forum: NADA
        • Canada Congress
        • Europe Congress Conversations
        • Fixed Ops Journal Forum
        • Shift: Mobility at a Crossroads
      • Awards
        • 100 Leading Women
        • 40 Under 40 Retail
        • All-Stars
        • Best Dealerships To Work For
          • Register for the 2021 Best Dealership To Work For
        • PACE Program
        • Rising Stars
        • Europe Rising Stars
    • JOBS
    • AN Solutions
    • +MORE
      • Leading Women Network
      • Podcasts
        • Shift: A Podcast About Mobility
        • Special Reports Podcasts
        • Daily Drive Podcasts
      • Webinars
      • In the Driver's Seat
        • AAM
        • Cars.com
        • DealerPolicy
        • Gentex
        • IHS Markit
        • Remember Group
        • Reputation.com
        • Ricardo: Dave Shemmans
        • Ricardo: Marques McCammon
      • Publishing Partners
        • Allstate: Want more from your F&I?
        • Ally: Navigating the future of automotive retailing
        • Amazon Web Services: Any place, any time, any channel
        • Amazon Web Services: The power of the cloud
        • Amazon Web Services: Universal translator: Harnessing sensor data to build better automotive software
        • Capital One Auto: Dealerships remain vital to an increasingly digital car shopping journey
        • DealerSocket: 5 steps to modernizing the buyer's journey
        • Epic Games: Real-time tech is the next frontier of automotive
        • Epic Games: Transforming the auto industry with digital assets
        • FTI Consulting: Crisis as a catalyst for change
        • Google: 5 trends shaping the auto industry's approach to a new normal
        • Google: Google's dealer guidebook helps dealers navigate today's digital landscape
        • IHS Markit: Automotive loyalty in the wake of the COVID-19 recession
        • IHS Markit: COVID-19: The future mobility delusion
        • Level5: 2020 Automotive E-Commerce Report
        • Motormindz: Toward hyperconnectivity: 5 ways to position your business to profit from connected car
        • Naked Lime: Bring social reputation together as part of big-picture marketing
        • Wells Fargo Auto: Switching gears from LIBOR to SOFR
        • Ally: Do It Right
        • DealerSocket
        • Deloitte: Cyber everywhere: Preparing for automotive safety in the face of cyber threats
        • Facebook: The road to a zero-friction future
        • Guide To Economic Development
        • PayPal Credit: How consumer financing helps drive sales for online auto parts retailers
      • Classifieds
      • Companies on the Move
      • People on the Move
      • Newsletters
      • Contact Us
      • Media Kit
      • RSS Feeds