Japanese legacy automaker Nissan announced a more aggressive electrification strategy on Monday amid the race for cheaper battery electric vehicle models. As per the press release, Nissan aims to cut costs to match EV prices with their gas-powered counterparts by the decade’s end.
“The Arc” business plan
As part of the newly introduced “The Arc” business plan, Nissan will expand its electric vehicle portfolio to give customers more choices depending on their preferences. It will also devise more powerful batteries to alleviate range anxiety among owners. Moreover, it will cut production costs to match the affordability of gas-powered vehicles and boost sales by 2030.
“The auto industry is now being forced to reshape its values, so we can say continuous change is the new normal. Nissan must change. We cannot succeed if we continue along the same path.”
Chief Executive Makoto Uchida told reporters Monday
Nissan to cut costs to match gas-powered car prices
As mentioned, Nissan plans to reduce the costs of its next-gen electric vehicles by 30% to close the pricing disparity with traditional internal combustion engine-powered vehicles by 2030.
With this effort, CEO Uchida said that the Japanese company expects its global electric vehicle sales to increase by a million units in the given period.
Nissan shared that it plans to collaborate with suppliers from the development stage to cut costs. It also plans to upgrade production processes to integrate robotics and artificial intelligence. It also aims to use similar components for different models, not just platforms. In addition, it also pledged to introduce autonomous driving technology to offer safe driving.
Nissan plans to leverage its global partnerships, including those with co-Japanese automaker Mitsubishi, Dongfeng Nissan in China, and Renault in France. It is also currently in talks with Japan’s Honda regarding a potential partnership on electrification and AI.
For context, Nissan’s total vehicle sales reached almost 3.4 million globally in 2023, indicating a notable increase of approximately 5% year-on-year.
New models in the pipeline
Apart from the cost reduction plans, Nissan also aims to roll out 30 new models in the next three years. Of those, 16 will be electric vehicles.
In addition, the Japanese automaker aims to launch 34 new EVs from fiscal 2024 through fiscal 2030. This launch plan is part of its wider strategy to have EVs account for 40% of its global lineup by fiscal 2026 and 60% by the end of the decade.
In hindsight, Nissan was actually an electric vehicle pioneer. It introduced the Nissan Leaf EV as early as 2010, even before other legacy automakers. However, it has continuously fallen behind America’s Tesla and China’s BYD.
Therefore, the new “The Arc” business plan is indeed crucial for Nissan to catch up.
“The Arc plan shows our path to the future. It illustrates our continuous progression and ability to navigate changing market conditions. This plan will enable us to go further and faster in driving value and competitiveness.”
Chief Executive Makoto Uchida told reporters Monday
Nissan’s newly announced electrification strategy is definitely encouraging for the electric vehicle industry. However, we can only see the fruits of it until around 2027 at the earliest. It would be exciting to see how the Japanese automaker would hold out until then amid the intensifying competition among legacy and startup automakers.
