NASHVILLE -- To say that Nissan North America is completely comfortable with the regulatory demands it faces on zero-emission vehicle sales around the country is probably an overstatement.
In fact, Nissan officials cringe at the suggestion.
But in truth, few, if any, multisegment automakers are in better shape than Nissan.
By virtue of mass-marketing its Leaf electric vehicle in the U.S. for the past five years, Nissan is already in full compliance with the ZEV requirements for California and the nine other states that follow the California regulations. And because Nissan began selling the Leaf before ZEV requirements in those states in the Northeast were in effect, the automaker will receive some privilege and flexibility as the regulations get tougher. For instance, Nissan would be allowed to meet compliance for the entire Northeast region by virtue of its sales in New York state.
All Nissan has to do to be in compliance in the ZEV regions is continue marketing and selling the Leaf in the appropriate states. And as the company's total sales rise in those states, Leaf deliveries must rise proportionately.
That will take some careful sales planning, cautions Tracy Woodard, the company's director for government affairs. The company obviously would like to see Leaf sales rise everywhere. But having strong Leaf sales in Georgia, for example, will not help Nissan meet its ZEV requirements in New York and Connecticut, she points out.
So the automaker must make sure it has adequate inventories on hand in the ZEV states -- even if it means other states have a harder time getting inventories -- and also devote more resources to marketing the Leaf in the states that, under California's rules, require ZEV sales.
Meeting state ZEV requirements is a math equation. The ZEV regions specify what percentage of total sales ZEVs must represent. That mandated percentage refers not to actual units of cars sold, but to the total number of credits earned from the sales. Each type of reduced-emission vehicle earns a different credit. A plug-in hybrid such as the Chevrolet Volt earns one credit amount. A pure electric earns another. And the driving range of the vehicle in question also determines its credit value.
But to get any credit, the manufacturer first has to sell the vehicle.
For Nissan, that will mean putting constant effort into marketing the Leaf and raising consumer demand for it across the 10-state bloc.
Last year, Nissan sold 17,269 Leafs in the United States, down from 30,200 in 2014.
Slumping demand for the EV is partly a reflection of sharply reduced gas pump prices, which have made consumers more carefree about buying larger vehicles again.
Nissan is OK for now, Woodard says. But Leaf sales do need to carry the load for a ZEV requirement that will rise between now and 2024.
Two things could make it tougher for Nissan: The brand has had few competitors in the EV segment until now. As the ZEV requirements confront the industry, Nissan likely will see more competitors trying to win away Leaf customers.
And Nissan is challenged by its own overall U.S. sales growth. The company has been on a steady growth curve for the past few years. The more vehicles it sells in total, the more Leafs it will need to sell to deliver the correct ZEV percentages.
It would help Nissan if its next-generation Leaf rekindles the car's initial wow factor. The company has revealed no specifics about its product plans, but it has hinted that the next Leaf will offer a much increased battery range. It is currently rated at 107 miles for a full charge.
But Woodard says there is an even bigger task in the coming years as more states adopt California's ZEV lead. The company must lobby states and local municipalities to actively support EV transportation.
That is something Woodard has been doing since Nissan decided to introduce the Leaf to the United States, shuttling from state to state to meet with government leaders and environmental groups to urge them to create local charging networks and adopt traffic and parking rules that encourage EV use. It is an effort that involves city planning, roadways, public parking and municipal funding.