Source:  Automotive News | Lindsay Chappell | August 21, 2017

Implications for next-gen Leaf, and other automakers.

Nissan’s capacity to build battery packs for its Leaf in Smyrna, Tenn., has outstripped demand.

NASHVILLE — Nissan Motor Co.’s decision to exit the electric vehicle battery business has implications for the next-generation Nissan Leaf, as well as for other U.S. automakers.

Nissan announced this month that it will sell its ownership interest in its battery venture, Automotive Energy Supply Corp., to a Chinese private investment group, GSR Capital. The price was undisclosed, but Bloomberg had reported that acquiring the business would cost $1 billion.

The sale comes as Nissan prepares to introduce the redesigned 2018 Leaf EV.

According to unconfirmed reports, the Leaf will debut with an EPA-rated battery range of roughly 150 miles on a full charge. That is a sharp improvement from the outgoing Leaf, which has an EPA-rated range of 107 miles. But it is significantly lower than General Motors’ new Chevrolet Bolt, which delivers about 238 miles to a charge, or the luxury-class Tesla Model S, which gets 235 miles.

Nissan has not revealed its marketing plan for the new Leaf. But signals from the automaker suggest that the car eventually will come with more than one battery option, similar to a vehicle that is available with a four-cylinder or a V-6 engine.

Nissan’s strategy appears to focus initially on affordability — aiming for about $5,000 less than the Bolt — rather than on industry-beating technology.

But subsequent trim levels of the Leaf will include a battery with a greater range, and a higher sticker price. Nissan will now rely on an outside battery maker to pull that off.

Automotive Energy Supply Corp., established in 2007 when no other batteries were available, is 51 percent owned by Nissan and 49 percent by Japan’s NEC Corp. Before completing the sale to GSR, Nissan will acquire 100 percent of the venture.

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