Wednesday, June 24, 2009

Nissan To Build Electric Cars In The US

Although details are sketchy, Nissan CEO Carlos Ghosn just announced that the company will build electric cars (not hybrids) in the United States. The company will release further details after it hears from the Department of Energy about its application for loans to build more fuel efficient vehicles.

At the same time, Ghosn took a swipe at the gas-electric hybrid Toyota Prius and Honda Insight, pointing out that hybrids have captured less than 7% market share.

Nissan's plan to build battery only electric vehicles (BEV), and not plug-in hybrid vehicles (PHEV) is interesting. As noted at the recent United States China Green Energy Council seminar on Electric Vehicles, the number of companies planning to build BEVs is two times the number planning to build PHEVs. BEVs tend to be more expensive than PHEVs because of their reliance on batteries. Further, BEVs will put more pressure on worldwide battery production. These are just some of the tradeoffs between BEVs and PHEVs that should be examined more closely.

The question going forward is whether BEVs and PHEVs will be mutually exclusive, or whether they can co-exist.

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