Nissan: "Leaf" to Cost $25K in U.S.

Nissan Motor Co. said Tuesday its new electric car will cost just over $25,000 in the U.S., a move that could force rivals to lower prices on similar vehicles.

The Leaf, a four-door hatchback due in showrooms late this year, will have a base price of $32,780, but buyers can get a $7,500 electric vehicle tax credit, Nissan said.

The price tag puts the Leaf, which can go up to 100 miles on a single charge from a home outlet, within reach of mainstream car buyers, and it also will force competitors to respond when they introduce their cars.

General Motors Co., which also will begin selling its Chevrolet Volt rechargeable electric car later this year, said that it will look at Nissan's pricing before announcing the Volt's price closer to its December sales date.

"I think it's fair to say their pricing, it won't overwhelm, but it will have some influence on our pricing decision," said GM spokesman Rob Peterson.

GM was looking to price the Volt, which can go 40 miles on full electricity before a small gas engine kicks in to provide power, around $35,000. It would cost $27,500 with the tax credit.

But GM executives have said they are trying to lower the price as they begin building models at a Detroit factory.

Other competitors, such as Ford Motor Co. and Chrysler Group LLC, also plan to sell fully electric cars, but those will come out after the Volt and Leaf hit showrooms in December.

Nissan says the Leaf will cost 3.76 million yen ($40,000) in Japan. It will price the car lower in the U.S. because it wants to sell more of them in that market. The automaker says it is confident it can still make money at that price.

Orders in the U.S. start April 20 and Nissan is aiming for 25,000 orders by December.

The price makes the Leaf one of the cheapest offerings in the fledging electric car market, but analysts said it was still a bit too high to appeal to a wide swathe of buyers. And the limited range of the car - 100 miles on a single charge - is still a major obstacle. Its top speed is about 87 miles per hour.

"It would have to be cheaper, but the main stumbling block is range," said Christopher Richter, an auto analyst at CLSA Asia Pacific Markets in Tokyo.

"For this to be a game-changer, you'd need to have double the range, and lithium ion battery technology just can't do that right now at an affordable price," he said.

Still, Richter predicted the car would definitely find an audience, particularly among "people who want to be green, people who love technology and people who are status-conscious."

"It'll be attractive to a lot of families as a second car, particularly in the U.S. market."

Owners of the Leaf - the name is meant to reflect the "purifying" function of leaves in nature - would need a special kit to recharge the car at 200 volts from their homes that Nissan would help set up. Normal Japanese current is 100 volts. The company has not said how much this connection set-up would cost.

A full charge takes eight hours, but a more powerful quick-charger that will be available in about 200 dealerships across Japan can recharge batteries 80 percent in under 30 minutes, Nissan said.

To help alleviate driver worries about running out of energy while on the road, Nissan will also install regular chargers at all 2,200 company dealerships in the nation. The company didn't disclose cost of using either of these chargers.

So far, some 65,000 people in the U.S. - where the LEAF went on a promotional 22-city tour earlier this year - have said they are interested in the car via Nissan's Web site. In Japan some 9,300 people have signaled an interest.

CEO Carlos Ghosn, who also heads France's Renault, has been a vocal proponent of electric vehicles, and predicts the segment will grow to about 10 percent of global sales by 2020.

The Leaf puts Nissan in a commanding position in the young electric car market, Richter said.

"Nissan is the vanguard on this," he said. "Really for the next few years, they are going to own the full EV (electric car) space in the same way that Toyota has owned the hybrid space for many years" with its Prius.

Production of the car will begin this fall at the company's Oppama plant, south of Tokyo, Chief Operating Officer Toshiyuki Shiga told a news conference.

In 2012, Nissan plans to start building the vehicle at its plants in Smyrna, Tennessee, and Sunderland, England. It will also produce lithium ion batteries at those two factories, as well as at plants in France, Portugal and Japan.

"Nissan will become the first in the world to produce an electric car on a global scale," Shiga said.

The Yokohama-based automaker played up the energy cost savings of the Leaf as well. It estimated that over six years of ownership, the electricity cost in Japan would be 86,000 yen. That compares with an estimate of 670,000 yen of gasoline cost for a similar class of vehicle over the same period, it said.

Other makers, large and small, are trying to develop viable electric vehicles amid growing consumer concerns about emissions and dependence on oil.

Mitsubishi Motor's i-MiEV costs 4.59 million yen ($50,000), and U.S.-based Tesla Motors makes a $109,000 Roadster electric sports car. Startups seeking the electric path include Chinese automaker BYD Co., Miles Electric Vehicles and Aptera Motors.

So far, electric vehicles have been largely experimental, mainly used by government-linked groups. Tokyo has made reducing greenhouse gases a pillar of its policy, and has encouraged the production of electronic vehicles as a way to achieve that.

Earlier this month, Nissan, Toyota Motor Corp., Mitsubishi Motors and Fuji Heavy Industries, which makes Subaru brand cars, and a major Tokyo power company set up a group of 160 business and government organizations to promote electric vehicles by standardizing recharging machines and marketing the technology abroad.