Nissan hopes EV ambitions gain traction with awd version of Ariya

NAPA, Calif. — A perfect storm of pandemic delays, production challenges and trade policies has hamstrung Nissan's shot at redemption in the electric vehicle segment that it pioneered more than a decade ago.

Nissan's Ariya electric crossover, originally scheduled to launch in the maw of the pandemic, arrived in the U.S. in late 2022 — about a year behind schedule. Now, manufacturing line problems have Ariya production reportedly running at least a third below plan.

Meanwhile, the Japanese-made model does not qualify for the $7,500 federal EV tax credit in the key U.S. market, leaving it flat-footed against some U.S.-built competitors.

Nissan is "studying" its options, Aditya Jairaj, the brand's U.S. head of EV strategy and transformation, told Automotive News this week.

"In the last few years, if there's one thing that we've learned, it's to be agile and nimble," Jairaj said at an event here to reveal the all-wheel-drive Ariya variant that goes on sale at the end of March. "There is nothing called "normal" anymore. You have to continually adjust to [ensure] there's value for the customer."

Jairaj, a mechanical engineer by training, wasn't ready to reveal the game plan to adjust to the early curveballs, but it could include tweaking Ariya pricing.

"We will remain competitive on the retail and the lease side," Jairaj said. "We'll do all that it takes to make sure this is a very important model for us."

Jairaj punted on the near-term prospect of bringing Ariya production to Nissan's North American factories, which would fulfill a key requirement for the federal incentive under the Inflation Reduction Act.

"Are we going to build the first-gen Ariya in the U.S.? I can't say yes; I can't say no," Jairaj said. "But overall, the industrial strategy is being monitored to make sure that we are the most efficient."

Jairaj is optimistic that as supply chain shortages ebb, soaring raw material costs will subside, giving the automaker greater flexibility on pricing.

"It's fair to say [high material costs are] temporary," he said. "Is it three months, six months, 12 months? I'm not a magician or an economist, so I can't say."

Nissan launched the Ariya in the U.S. via a reservation system. But slow deliveries and more EV options have not deterred Ariya's early adopters, of which more than 60 percent are new to the Nissan brand.

"The reservation cancellation rate has not abnormally changed," Jairaj said.

While Nissan can't do much about the Ariya's tax credit disadvantage in the near term, Jairaj and his team are working to "create value" elsewhere.

For instance, dealers are offering customers a second product deep dive following delivery.

"With all the technology that we have in the vehicle, with all the vehicle has to offer, consumers are not able to absorb all of that in one go," Jairaj said. "So, we go back to the customer's premises and help them better understand what their vehicle is capable of."

As Ariya draws more first-time EV buyers, the automaker offers peace of mind around the new technology. EV Carefree+ provides Ariya buyers a battery warranty and a year of complimentary access to the EVgo public fast-charging network. Also included: three years/36,000 miles of scheduled maintenance.

"We alleviate some of their inhibitions to purchase an EV," Jairaj said. "It's packaged in a manner to reduce consumers' stress."

The Ariya launch's early headwind could turn into a tailwind as Nissan prepares to deliver the higher-demand all-wheel-drive variant to the U.S.

The twin-motor system, dubbed e-4ORCE, manages power to all four wheels delivering high torque, precision handling and stability.

In a test of the system on a rainy, windy morning at the Sonoma Speedway in northern California, the Ariya stayed firmly planted through high-speed sharp cornering without fishtailing.

The Ariya bolts from a standstill but without the whiplash-inducing acceleration of some EVs. That linear acceleration is by design and makes the EV-driving experience more familiar to first-time buyers making the switch from the combustion engine powertrain.

Nissan senior engineer Dusty Pierson said e-4ORCE is a technological advancement over the automaker's all-wheel-drive system on some combustion engine models. "What we have with Ariya is a much quicker system," Pierson said, noting the new all-wheel-drive system is 50 percent faster at reacting to tire slippage and other road conditions.

"It's looking at everything from steering input, vehicle speed," Pierson said. "But the computing time is the magic."

Nissan anticipates the e-4ORCE variant to account for 60 percent of Ariya sales in the U.S.

Ariya allocations will increase "substantially" toward the summer to meet this demand, Jairaj said.

"Right now, we serve 35 to 40 percent of the U.S. market," he said. "With all-wheel driving coming in, we'll serve 100 percent of the market."

Jairaj said the key takeaway from the unpredictability of the Ariya launch is the need for speed to market.

"Are the same external factors going to affect future model launches? I don't know," he said. "But it's given us the ability to pivot much faster."

Jairaj said Nissan has accelerated decision making and is now willing to do it with more limited data.

"You want to make a decision; usually, you need 10 data points," he said. "Now, with two data points, we use hypotheses, we use wisdom from different partners and stakeholders, and we … move forward fast."