Nissan Ditching Gasoline Engines?

On February 8, 2022, Nissan announced its financial results for the third quarter of fiscal 2021 online. Quarterly sales were 904,000 units, showing a recovery trend compared to the second quarter, but the year-on-year decrease was due to the semiconductor shortage.

Apart from announcing such basic results, the EVsmart blog was paying attention to what the future electrification strategy would be. On the eve of the financial results announcement, that is, at midnight on February 7th, the Nikkei electronic version reported that Nissan had decided to stop developing new gasoline engines for Japan, Europe and China.

If this is true, it's a big deal. In the long-term vision "Nissan Ambition 2030" announced on November 29, 2021, Nissan will invest about 2 trillion yen in the next five years to advance electrification, and 15 types of electric vehicles (EV), We have announced that we will introduce 8 e-POWER models and increase the electrification ratio to 50% globally, but we have not said that we will stop developing gasoline engines.

[Related article] What are the points to be read from Nissan's electrification strategy "Nissan Ambition 2030"? (November 30, 2021)

On January 27, 2022, three companies, Renault, Nissan, and Mitsubishi Motors, announced the plan "Alliance 2030" as an alliance for 2030. By 2026, we will secure a global battery production capacity of 220 GWh annually by 2030, and five dedicated EV platforms, including the CMFB-EV EV platform for the compact segment, which we position as a game changer. The company aims to sell 1.5 million EVs annually.

[Related article] Three-company alliance “Serious about EV shift” roadmap announced / Nissan develops new compact EV to succeed “Micra” (January 29, 2022)

This alone is enough to fill you up, but if you say "Engine development is over", it will be a big change for electrification. I was watching the online press conference for the financial results announcement with a little excitement.

No new gasoline engine development in Europe

During the online press conference, Chief Operating Officer (COO) Ashwani Gupta reviewed the outline of the company's electrification strategy following the earnings announcement.

COO Gupta said, ``Nissan Ambition 2030 will shift gears towards a sustainable future to achieve a cleaner, safer and more inclusive world. I am,” he introduced the current situation, and spoke as follows.

"We will further promote the electrification strategy and expand the product lineup by starting sales of Aria and light EV.In China, we will expand sales of e-POWER (omitted).Nissan has accumulated so far We will grow the company by leveraging our experience to create added value for continued growth in the new era of electrification, and by pursuing business opportunities that contribute to improving long-term profitability.”

In other words, it was shown that hybrid vehicles centered on e-POWER account for a certain number, rather than completely abandoning the internal combustion engine.

The Q&A session that followed these remarks provided a little more detail. First of all, when asked to confirm the facts of the Nikkei report, he jokingly said, "We are responsible for the production strategy of the product, but I think we can make a more reliable strategy with your advice." , stated:

"We will not develop gasoline engines for Europe, because when Euro 7 comes in, customers will have to pay a much higher price for gasoline vehicles compared to electric vehicles. This is for us to decide. It's not about it, it's the customer's decision.They say they think an EV is more valuable than a petrol car."

And he also showed the view that the electrification ratio in the European market will be "about 76%".

Euro 7, which is expected to be introduced in the middle of the 2020s at the earliest (Emission regulations scheduled to be introduced in the EU in 2025. Average fuel consumption of all models sold must be 24.44 km / liter or more, A fine of 95 euros is imposed for each vehicle), which requires real-world (practical level) exhaust gas measurements and strict particulate matter regulations, so it is considered extremely difficult to clear not only diesel vehicles but also gasoline vehicles. It is In addition, some regions are moving to regulate internal combustion engines themselves.

Also, looking at Nissan's regional sales, 90,000 of the 904,000 total sales this quarter were in Europe. The difference is clear compared to 262,000 in North America and 313,000 in China.

As Nissan, there is little advantage in introducing new gasoline vehicles at this cost, so it makes sense to promote electrification in line with the direction of the market.

If EVs become popular in Japan, there is a possibility that the number will increase

What will happen in markets other than Europe? Gupta COO responded to this point as follows.

"However, there are still customers who want different powertrains in some markets. We have to meet their needs."

As a specific example, Gupta COO introduces that the new Z, which has been announced as a production model ahead of the US market, is equipped with a twin turbo with a 9-speed AT and a 6-speed MT. "We will not use gasoline engines in Europe after Euro 7, but we will continue as long as it makes sense for customers and business in the market," he said.

Then, what will happen to the Japanese market where you live? Gupta said that the electrification ratio in Japan was 55% in "Nissan Ambition 2030", "that means 45% will remain gasoline vehicles." Considering this statement based on the aforementioned policy that "needs must be met", it is judged that there is no demand for EVs in Japan and that there is no market. It's a shame.

However, he acknowledged that the domestic market is "extremely important" for Nissan, saying,

"Japanese customers may say that we will increase the number of electrified vehicles from tomorrow. We announced the Nissan Intelligent Factory in Tochigi. We also have a battery factory in Japan. We are ready."

Of course, I'm assuming that electrified vehicles here are EVs. The Intelligent Factory is a next-generation factory that aims to be carbon neutral by 2050. We don't have a market yet, but we're ready to meet the demand.

By the way, sales in the Japanese market were 94,000 units this quarter. It's not much different from the 90,000 cars in Europe where gasoline engines are no longer used. In this case, I think the impact would be limited even if we stopped using engine cars, but there seems to be no immediate option because there is a big difference in policies and user perceptions.

There was also a related question, "What do you do with the Chinese market?", but there was no clear answer. It feels like I forgot to answer and passed through. I didn't accept re-questions at the interview, so it just flowed.

There was also a question about what happened to Infinity. Gupta's answer was, "Infiniti is included in Nissan Ambition 2030. We will talk more about it soon."

In Toyota's electrification strategy announcement at the end of last year, Lexus stated that "in the luxury segment, customers' expectations for advanced technologies and EVs are rapidly increasing." announced a policy to shift to EV.

Then it would be natural to think of Infinity. I look forward to your announcements in the near future.

[Related article] Toyota seriously declares electric vehicles-targeting 3.5 million BEV sales in 2030 (December 15, 2021)

Aiming for electrification within the reach of gasoline-powered car users

Finally, the question "How do you see Tesla?" popped up. Gupta COO commented, "The great thing about Tesla is that it has raised the awareness of EVs. This has helped not only Tesla but also our company." explained the attitude of

When we launched the Leaf as an EV pioneer in 2010, there were no customers, no infrastructure, no market, and the government didn't want anything. Because we wanted to show our innovation."

And while welcoming the rise in awareness of EVs and the creation of competition in the market, he said that the important thing is to make electrification affordable for those who have Nissan's gasoline cars. I'm here. That's why we will introduce EVs to mini vehicles, which account for 40% of the domestic market.

Correcting Gupta COO's comments: Nissan currently sells about 5 million vehicles a year. Assuming an average ownership period of 5 years, there are 25 million Nissan vehicles owned worldwide. The important thing is how to provide electrified cars to Nissan fans who own 25 million units (Gupta COO).

Social issues cannot be solved without numbers. A light EV is one way to do that. From a mean point of view, no matter how much CO2 emissions are zero when driving, the more EVs are produced, the more the environmental burden increases, so the position of mass-produced car manufacturers is difficult. I think later.

Anyway, Nissan's policy was already shown, and it wasn't that "end of engine development". If you ask me, "Why don't you pull this far?"

First of all, I'm looking forward to the details of the light EV. Personally, I think it would be nice if the design was completely different from the Mitsubishi light EV that was on display at the Auto Salon the other day, but what will happen?

(Text / Ryuitsu Kino)