While the DOE was out investing in startups like electric car manufacturers Tesla ($465M) and Fisker ($528M)—or rather guaranteeing loans, the equivalent of investing minus the equity—the regular old car companies were not sitting on their hands. In fact, while Tesla has ramped up production of its $109,000 Roadster to roughly 100 units per month, Nissan has announced its new $25,000 electric car, which will go on sale in the U.S. in December.
According to the AP (Nissan),
The Leaf, a four-door hatchback, will have a base price of $32,780, but it’s eligible for a $7,500 federal tax credit for electric vehicles. That will make it cheaper to buy than electric vehicles coming from rivals and may force competitors to cut prices. But the Leaf’s limited range of just 100 miles per charge for its lithium-ion battery could be a dealbreaker for some motorists.
Customers can start reserving a Leaf in the U.S. on April 20 and Nissan is aiming for 25,000 orders by December. It hopes to build and sell 50,000 of the cars around the world during the first model year. Production is starting at an existing factory in Oppama, Japan, south of Tokyo, and will expand to Nissan’s factory in Smyrna, Tenn., in 2012.
It begs the question—do we really need a silicon valley startup to produce electric cars? In many ways, Microsoft, Apple, and Google were revolutionary. These companies were uniquely configured to design, build, and sell products and services in ways that were fundamentally different from then current market leaders. And so they led revolutions in the personal computer, software, and internet markets.
Is a wholly new business model required for leading a revolution in electric cars? Yes, the drive train is different, but does building electric cars, marketing electric cars, selling electric cars, and servicing electric cars require fundamentally new organizational structures, skill sets, or business models.
If Nissan can introduce an all-electric car with the capability of producing 50,000/year (or 4,116/month), where is Tesla’s advantage? As Tesla attempts to introduce a $50,000 sedan, where will Nissan be—let alone Honda, Toyota, and who knows how many other car companies who already have the supply chains, production lines, and distribution and sales to move their own models.
The clean tech revolution will not be fought and won where the incumbents’s business models can remain intact. If we’re waiting for the google of electric cars, it’s going to be a while.