business story yet because the value is lower
than their costs.
Posted on 01/31/2005 8:17:49 PM PST by newgeezer
NEW ORLEANS (Reuters) - The head of Nissan Motor Co., breaking ranks with some of his leading rivals, said on Saturday that building fuel-sipping hybrid vehicles makes little sense in today's world because of their high costs.
"They make a nice story, but they're not a good business story yet because the value is lower than their costs," said Nissan Chief Executive Carlos Ghosn.
Nissan will, in fact, start manufacturing a gas-electric hybrid version of its Altima sedan for the U.S. market in 2006.
But Ghosn said the model was only intended to help Japan's second-largest automaker comply with strict fuel economy and emissions standards in states like California, not because he expects it to be a money-maker.
Nissan will license some technology for the hybrid Altima from Toyota Motor Corp., which is the world leader in hybrid production along with Honda Motor Co. Ltd.
The hybrids made by Toyota and Honda are in high demand, but production levels are still relatively small.
Toyota plans to nearly double production of its hybrid Prius car for the U.S. market this year, with production totaling some 100,000 vehicles.
Ford Motor Co. is alone among U.S. automakers in producing mass-market hybrid models; Ford recently announced plans to introduce four new models between this year and 2008.
Ghosn's comments, which are likely to draw criticism from environmental groups, came in an address to the National Automobile Dealers Association, which opened its annual convention in New Orleans on Saturday.
In his speech, he noted that only about 88,000 of the 16.9 million light vehicles sold in the United States last year were hybrids, adding that they are still considered "niche" products and something way outside the automotive mainstream.
He also poured cold water on hydrogen fuel cell vehicles, which many automakers see as the industry's next big technological breakthrough.
"The cost to build one fuel cell car is about $800,000. Do the math and you figure out that we will have to reduce the cost of that car by more than 95 percent in order to gain widespread marketplace acceptance," Ghosn said.
Ghosn, who is credited with a dramatic turnaround at Nissan, is poised to take over as chief executive at France's Renault SA in May.
His future role, simultaneously running operations at two major automakers, is thought to be an industry first.
Nissan -- owned 44 percent by Renault -- scored the biggest sales jump of any major car maker in the United States last year, with a 24 percent surge to 986,000 vehicles.
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He's right. I tried having a conversation with a hybrid car and it was utterly incoherent.
BUMP to your list. Challenging the conventional environmental wisdom. This one will make the envirowackos go wild!
(heh heh heh)
They should change the name from hybrid cars to Politically Correct cars.
He's wrong and his days are numbered at Nissan.
Toyota is investing heavily in the Prius hybrid to be manufactured in China. It may not make economic sense to manufacture hybrids using high priced Japanese labour and production facilities but China is a different story.
Ping to your attention and/or lists. Make your local envirowacko mad with this one.
Added CA to topics list.
They're cool and I'd buy one at the right price. I'm willing to pay a slight premium, but not a huge one. I say build them in China or wherever and see if a market rate can be established such that they can have sales volumes high enough to make a dent in the overall market...if so, cool beans...Otherwise, no need to make regulations...
Hybrid cars are "over rated" in that their gas mileage is not nearly as high as the EPA ratings indicate. The fact is, they are simply very good at the CAFE rating system (course run on a dyno I believe).
It is difficult to determine just how overall efficient they are, whether their increased mileage makes up for the increased upfront cost and the cost of battery disposal, etc.
I'm hyperventilating here. How DARE he! How DARE he go agains the dictates of Conventional Wisdom which is ALWAY right and gives us a sense of COMMUNity. /sarc
I guess the diesel engine was expensive when it first came out as an alternative to the gas engine. Hybrid engines are the wave of the future - 10 years on maybe? Hybrid engines make even more sense for gas guzzling SUVs.
> Diesels make a lot more sense.
That was our take in 2002. The Toyota appeared to be
heavily subsidized. The Honda was a wimpmobile. Both had
a reputation for under-delivering mpg in cold weather.
So we went small-block turbo-diesel. No regrets.
Diesel-electric (what "diesel" railway locomotives are)
might make some sense for larger highway vehicles.
But this could also just be Nissan spreading FUD.
Many actual people spending actual money for hybrids
aren't doing it for purely rational economic reasons.
Nissan has nothing for those customers today.
The energy equations will need to be balanced all the same whether hydrocarbon fuel is used or electric power. Just because you have moved the cost around a little, doesn't mean that it's not there.
There is no such thing as a free lunch, especially when it comes to the conservation of energy.
Because the latest technology makes diesel engines run much cleaner, I wouldn't be surprised that within the next 3-4 years minivans, SUV's and light trucks start a complete switch to clean turbodiesel power. That right there will allow for much stricter fuel economy standards, as much as 35% improvement in fuel economy! 
By the way, Mr. Ghosn should know something about diesel engines in automobiles: in Europe, diesel-powered automobiles now make up 40% of all new car sales. The company Ghosn will soon head--Renault--has heavily invested in diesel technology, and Renault's fortunes have improved in the last ten years thanks to vehicles like the Scenic and Modus, both of which are very popular all over Europe.
Did you know that you have to replace the costly batteries at 150,000 miles? They don't talk about that on "Motorweek".
Hybrids also have the advantage of burning a lot less fuel in low-speed conditions, so they pump less gunk into the atmosphere in cities with lots of traffic congestion. If hybrid technology is somehow the conventional wisdom, I'll go with it this once.
Except for the fact that after market tests have not been able to come close to reproducing the mpg that Toyota claims. The actual mpg isn't any better than some regular cars on the market.
I could deal with that. My father-in-law just traded his Toyota pickup for a Prius. He was spending $60/week on gas...now he is spending $20 every other week. That is quite the savings. Our next car is going to be the Accord Hybrid.
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