UPDATE 3-Nissan launches Leaf, bets big on electric vehicles

* Production at maximum 50,000 units per year until end-2012

* Hatchback is rated with driving range of 200 km (124
miles) in Japan

* Vehicle to cost just under 3 mln yen, inc subsidies

(Recasts with details)

By Chang-Ran Kim, Asia autos correspondent

YOKOHAMA, Japan, Dec 3 (BestGrowthStock) – Japan’s Nissan Motor Co
formally launched its zero emmisions Leaf
vehicle, an electric car boasting a range of 200 kms (124
miles) and billed as the first of its type to be sold on a
large scale.

Nissan and Renault are counting on an aggressive push into
the nascent electric car market to boost their brand image —
much as the Prius hybrid did for Toyota Motor Corp
.

Electric vehicles (EVs) are considered a promising
alternative to internal combustion engine cars as governments
seek to cut the world’s dependency on fossil fuels, but their
relatively short range and high price have long challenged the
industry.

“When you take the scale of their (Nissan’s) commitment,
it’s a big bet,” Kurt Sanger, auto analyst at Deutsche
Securities, said on Friday.

“The challenge for Nissan is to capitalise on its early
lead and solidify in consumers’ minds the perception that EVs
equal Nissan,” Sanger said, adding: “It’s hard to find a car
maker that’s not planning an electric car over the next five
years.”

Nissan said the five-seater hatchback was rated with a
range of 200 km (124 miles) on a full charge under Japanese
test standards, although Californian authorities have rated it
at 160 km (100 miles) and another U.S. agency at just 73 miles
(around 130 kms).

It comes with a suggested retail price of 3.76 million yen
($44,900), discounted to 2.98 million yen in Japan with
government subsidies. In the United States, the Leaf will cost
about $25,000 after a federal tax credit and in Europe about
30,000 euros before subsidies.

“With today’s launch … we mark the start of a new era
for the global auto industry as well as for a sustainable,
low-carbon society,” Nissan Chief Operating Officer Toshiyuki
Shiga, standing next to a sky-blue Leaf at Nissan’s
headquarters in the port city of Yokohama, told hundreds of
journalists.

Delivery of the car will start in Japan and select U.S.
states this month, followed by the first European markets in
January. Nissan has already filled a maximum initial order for
6,000 Leafs in Japan and 20,000 units in the United States,
set to reach customers over the next year or so.

ELECTRIC CAR FOR THE MASSES

Nissan is not the first major automaker to mass-produce an
electric car. That honour belongs to Mitsubishi Motors
, which launched the smaller, egg-shaped
i-MiEV last year.

But Nissan and Renault SA , are aiming
to be the top sellers in the market, which they expect to make
up a tenth of new vehicle sales globally by 2020.

The partners have earmarked $5 billion over the next few
years to mass-produce electric vehicles and the batteries that
power them. By 2013, the alliance will have the capacity to
produce 500,000 batteries, some of which will be used for
hybrid models.

Until production of the Leaf begins in the United States
at the end of 2012 and in Britain after that, output would be
limited to 50,000 units a year, Shiga said.

Mitsubishi Motors’ i-MiEV costs 2.84 million yen in Japan
after subsidies, and cumulative sales hit 5,000 units last
month after its launch in July 2009.

The EV subsidies are applicable only until the end of
Japan’s fiscal year, on March 31. The government has yet to
announce its incentive policy beyond that date.

A NEW CAR

As automakers including Volkswagen AG
(VOWG_p.DE: ) and Toyota Motor Corp
roll out their EVs in the coming years, they will need to
educate consumers to quash misconceptions and prepare them for
features unique to EVs.

At Friday’s launch, Nissan showed video images of the Leaf
undergoing vigorous tests — including being struck by an
artificial lightning bolt in a lab and emerging unharmed from
flooded waters that came up to its headlights.

While most big automakers have plans to develop EVs,
General Motors and Toyota are for now looking
to compete against the Leaf with plug-in hybrids which can
which can run both in EV mode and on gasoline. GM will begin
selling its Chevrolet Volt “range extender” in the United
States this month, while Toyota’s plug-in Prius hybrid is due
by 2012.

To address “range anxiety” on the Leaf, Nissan has
installed normal charging spots at about 2,200 dealers around
Japan, and quick chargers capable of charging to 80 percent
capacity in 30 minutes, at 200 sites.

An onboard computer connected to a data centre tells
drivers how much power they have left and how far they can
travel.

Nissan is putting would-be buyers through a vetting
process to make sure they are the right fit for an EV. Anyone
driving more than 100 miles a day regularly would be steered
to a traditional gasoline or diesel car, while in some
markets, Nissan will give customers with occasional
long-distance driving needs an option to rent a conventional
car at a low price.
($1=83.82 Yen)
(Editing by Edwina Gibbs and David Fox)

UPDATE 3-Nissan launches Leaf, bets big on electric vehicles