Sat. May 28th, 2022


Being the CEO of a global car giant clearly requires a thick portfolio of talents – a skill set to cover everything from redesigning a crisis-ridden supply chain, to placing epoch-making bets on emerging technology, to the decided on a heart-stopping name for a mid-range hatchback.

But surely, as a fundamental requirement, they should be able to sell a car. The skill at stake here is not the same one that introduces several million vehicles across esoteric international markets, but the smiling-while-saber-toothed slims that drive a car off the garage’s forecourt. Unwavering faith in the product is crucial to it. But it also seems, at this particular moment, extraordinarily elusive.

Nissan illustrated the problem perfectly last week. Since becoming Japan’s third largest carmaker in 2019, Makoto Uchida looked like someone carefully sucking a bird with broken wings after flight. On his second anniversary of takeover, he declared that the company’s crisis was over. Uchida has definitely earmarked $ 18 billion to accelerate the transition to electrification. From the tone of his presentation, the work of vision building and motoring was firmly in hand. The risk now is that the former hinders the latter.

Established car manufacturers in the US, Europe and Japan face similar challenges as car buyers are forced to choose, not only between different models and brands, but between competing technologies.

While it is clear that electric vehicles (or at least an alternative to internal combustion engines) is the future, and that it will suit governments everywhere to be seen as supporting the EV revolution, those certainties have not yet translated into coherent strategies for many companies. Nor has a wide, compelling set of choices for customers emerged.

There are still big bets outstanding on the right technological investments, the speed of customer conversion and the expansion of charging infrastructure. Toyota, the world’s largest carmaker by sales, has recently had pain to throw carbon as the enemy rather than the internal combustion engine per se and to convince himself and the outside world that his bet on a long-term spread over hybrid, hydrogen and battery-powered technology is the right approach.

Even Nissan, which was pioneering work for mass market EVs when it launched the Leaf more than a decade ago, is still careful not to set a date on the death of the internal combustion engine. It has not yet pretended to go all in on electric. In 11 years, it has repeatedly updated the Leaf to a fine (if expensive) small car, but has a limited range of other models. Even its stated target of offering 23 models of “electrified” vehicles by fiscal 2030 includes about one-third that will rely in part on fossil fuels.

The difficulty that Nissan and others face is that although in the past they had room to move for the time being, they are now forced to formulate their visions in the shadow of one company.

Elon Musk’s Tesla Effective brought the market into a corner a vision. Chinese newcomers could do similar in their domestic market. With sales of 600,000 electric cars in the first nine months of 2021, Tesla has a market capitalization of more than $ 1tn. Numerous factors are at work in that astonishing relationship, but the most obvious is that Musk articulates certainty, while the incumbents, no matter how bold their words, manage to sound ambiguous. Worse, they seem to invite ambiguity in their customers.

Uchida’s response was an attempt to please the master. The focus of last week’s presentation was plans to build a pilot plant for its solid state batteries within a few years and to build it in mass market cars before March 2029. This technology, which many companies invest heavily in to perfect, would be transformative for EVs. The batteries, according to a fascinating series of animations by Nissan, will make it possible to make cars with lighter materials, in a much larger range of styles, with greater driving distances and shorter charging times. Even existing lithium-ion batteries, Uchida said, will be much cheaper in the coming years.

The problem is that where concept cars and stylish animations were never a reason to postpone a car purchase, it is now. Big visions are all very good, but they do strange things to the dealer-customer relationship, as long as the state of the technology race is the most relevant factor.

Uchida’s promise of impending technological magic can lead the customer to the conclusion that nothing is currently at the forefront of Nissan’s showrooms. That means, from the most junior dealer to the CEO, Nissan has been placed in a position of seriously selling placeholders, while fervently believing in a car that does not yet exist.

leo.lewis@ft.com



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