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Transportation Businesses

Nissan Won't Build Its Own Electric Car Batteries Anymore (cnet.com) 132

An anonymous reader shares a report: Balancing every single task by oneself, instead of getting some help, can break a person down in record time. That's likely why Nissan has decided to step away from manufacturing batteries for its electric vehicles. Nissan announced on Tuesday that it would sell its battery-manufacturing subsidiary, Automotive Energy Supply Corporation (AESC), to the Chinese investment firm GSR Capital. "This is a win-win for AESC and Nissan. It enables AESC to utilize GSR's wide networks and proactive investment to expand its customer base and further increase its competitiveness," said Hiroto Saikawa, president and CEO of Nissan, in a statement. "In turn, this will further enhance Nissan's EV competitiveness. AESC will remain a very important partner for Nissan as we deepen our focus on designing and producing market-leading electric vehicles."
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Nissan Won't Build Its Own Electric Car Batteries Anymore

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  • by WindBourne ( 631190 ) on Tuesday August 08, 2017 @02:08PM (#54967115) Journal
    Seriously, they control their own future and have the ability to drop costs relative to others.
    OTOH, companies like Nissan, GM, Ford, etc that do NOT build their own plants will not be able to compete against Germans (who are late to the game, but getting there), the Chinese (who will learn how to properly make cars, but at this time, only a fool would buy), and Tesla.
    • Re: (Score:2, Insightful)

      by Anonymous Coward

      To some degree, it is also a HUGE risk that Chinese government sponsored industry will undercut prices and take the entire market like they have with steel, solar panels, etc...

      The increased trade between Japan and China is a direct result of the abandonment of the TPP and foreshadows the unabated growth of China as America decides to withdraw from trade deals and pick at bellybutton lint instead of competing and controlling world markets.

      • by Rei ( 128717 ) on Tuesday August 08, 2017 @03:33PM (#54968011) Homepage

        There's no risk with this purchase. Nissan's battery "technology" in the Leaf is terrible. Among the worst in the industry, if not the worst in the industry. It's just passively cooled prismatic cells wired together in a giant "suitcase". The average degradation on them is terrible.

        • Nonsense. I have owned two Leafs, the batteries are great. Very low degradation even under extreme conditions - taxi companies doing multiple rapid charges every day and a 100% charge overnight, for 200,000 miles. They actually removed the "long life mode" 80% charge option from newer models because it was pointless, the 100% charge having no real effect on the battery pack.

          They are passively cooled, but that's fine for the Leaf. You only need active cooling if you want to charge at >50kW or for longer periods than a 30kWh pack needs, or if you are drawing more energy than the Leaf does even brodering it. Again, taxi firms running the cars hard, charging them hard, demonstrates this.

          • by Rei ( 128717 )

            Very low degradation even under extreme conditions

            Great for you, but it's a well known problem that many people have experienced [casteyanqui.com]. There's a reason that pretty much everyone else is climate controlling their packs. Tesla degradation isn't anywhere nearly so fast [google.com] (click "charts")

          • Many things can seem great while still being the worst in the industry. Just because the Leaf works well for you and a bunch of taxis doesn't mean it works for an even wider audience and doesn't mean that there aren't better options available.

          • Where do you live?
            The battery life of the leaf depends on where you live.
            In Denver, the leaf is SO-SO. North of here, the leaf appears to do pretty good. OTOH, down in pueblo Colorado, they constantly burn out early and then go cheap (5K).
            The leaf battery, along with the HVAC on it, actually DOES sux.
          • by rtb61 ( 674572 )

            What to do with old battery plant when new battery technology comes out that the old battery plant can not produce. We are pulling out of battery manufacture and want to sell our old plant, because of 'cue business psychobabble'. Then, we have had a change of heart because of 'cue business psychobabble' and will build a new battery plant using the new battery technology. That is the problem with battery technology, a jump in efficiency and longevity absolutely slaughters old technology, just puts it right o

            • Not really. Lithium is required for high density batteries. In fact, the high energy density come from Li-air batteries. It is impossible to build a battery with higher energy density. As such, as long as batteries are used, similar plant technique will be used. As to the other elements, they would simply be recycled and used in other products. The only thing that will boot batteries, is capacitors, and they do not have high enough energy density. Yet.
              • by Trogre ( 513942 )

                It is impossible to build a battery with higher energy density.

                That seems like a rather implausible claim, or a very narrow definition of "battery".

                • by Rei ( 128717 )

                  Indeed. Lithium is hardly the most energy-dense substance in existence. It has lots of desirable properties, but it's not the be-all end-all.

                  Actually, sodium-air batteries would be even better. Still much more energy dense than li-ion (although not as much as li-air), but sodium is dirt cheap. Lithium isn't super-expensive, but sodium.... I mean, it's the cation in salt, it's bloody everywhere. And can be reduced to metal for a final price similar to that of aluminum.

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      Remember the days when monocultures and monopolies were frowned on around here. Yeah, those were good times. Now we have people who can't scream "TESLA!!!!!1111!!!!" loud enough.

      • Re: (Score:2, Insightful)

        by Anonymous Coward

        Because Tesla understands that battery costs are the key to competitive electric cars. The only way to control that is to build them, not outsource manufacturing to a third party hungry for extra margins. Auto companies still manufacture their own engines for this very reason.

        • See also: Apple and their A-series CPU+GPU. Anyone want to bet they have A10-whatever Mac prototypes in their labs? They went from 68000 to PowerPC to Intel, another transition doesn't seem far-fetched.

        • Tesla is making a big bet that they can stay ahead or at least even on the battery technology front. If a competitor comes out with a newer/cheaper/better battery solution, Telsa is stuck with what they are investing huge sums into. They can overcome some of that by managing their own margins, but if something were to drag the battery part of their business down, it could drag heavily on the car business (and other Telsa businesses). Its a strategy that can pay off big or be painful.
          • by Anonymous Coward

            Tesla aren't even ahead at the moment. They are just very effective at generating hype and buzz.

          • Agree; I don't know how much they are putting into fundemental research, but I have to imagine they are restricted in chemistry. This provides significant long-term risk for them.

            That said, they are doing the right things by finding multiple markets for the batteries fast which should lower costs, and arguably more importantly an existing model isn't just going to jump onto a new battery overnight, so there is some inherent logic to focusing on improving one chemistry.

            If China starts dumping batteries it wi

      • Remember the days when monocultures and monopolies were frowned on around here.... Now we have people who can't scream "TESLA!!!!!1111!!!!" loud enough.

        Exactly. With Tesla's market share nearing 0.01%, we definitely need to be concerned about their monopoly power.

        • by Rei ( 128717 ) on Tuesday August 08, 2017 @03:56PM (#54968225) Homepage

          Annual US car production is under 4 million units [oica.net]. Tesla Model 3 production is scheduled to hit 500k next year. That's what people are investing in Tesla for. Because this is a big, big thing.

          And that's just one year. So far Tesla has gotten a nearly 2 year waiting list without any advertising at all, without anyone being able to test drive it (or even know all the specs for most of that time), and with Tesla trying to anti-sell it to try to drive buyers to S and X instead (which they can actually get cash from today, rather than two years in the future). With advertising Tesla expects to raise the 500k to 700k (this will involve moving S and X motor production to gigafactory to free up space at Fremont). A couple years from now they'll also be introducing the Model Y crossover (crossovers being more popular than sedans). They also have a major electric semi truck project in progress, and are developing the Supercharger V3 to support it. After the Y and semi they're discussed a new Roadster, a pickup, and a lower-cost sedan.

          Nobody is putting money into Tesla because of their current sales. They're putting money into Tesla because of how much pent-up demand there is for its vehicles - whether you happen to be part of that demand or not. Said investment money is to let them tool to convert demand into sales and thus profits. Talking about figures related to Tesla's current market share are just silly when they're in the middle of building a plant to increase the US's total car production by 28%.

          • Probably a bit unfair comparing just US production. Tesla produce all their cars for worldwide distribution in the US. The larger US manufacturers have factories dotted around the world.

      • Vertical integration is not monoculture or monopoly. Monoculture would be if Nissan, GM, Ford, etc all started buying Tesla batteries.
      • Now we have people who can't scream "TESLA!" loud enough.

        You could always use that [amazon.com]. For everything else, there's MasterCard.

    • by Anonymous Coward on Tuesday August 08, 2017 @02:29PM (#54967347)

      These type of batteries are going to be a low margin commodity.

      In the meantime, Tesla is burning through cash for its operations. It just issued bonds that being rated in the low Bs.

      It has two more years to get market share and after that, the big boys are coming in at full strength.

      Tesla's future is hardly a guaranteed success. But, Tesla's stock doesn't trade on fundamentals: just pie-in-the-sky dreams. Dreams created by Elon's publicist. It's amazing how techies who can be so skeptical and rational throw it all away when it comes to the cult of Musk.

      It's exactly how religious people think - hence the use of the word cult.

      • Although if they build the 'best' battery, they can still say in the small margin battery business even if they stop making cars. It's like a Husqvarna mower with a Honda engine, except it'll be "Ford e-Peen, Powered by Tesla!" on the advert.
      • Tesla reminds me a lot of Apple..... Knew exactly how to generate a "buzz" around their products, while actually doing a pretty good job of doing R&D to make cool (but expensive) things people want to own.

        Apple users are often accused of being religious zealots too.

        The thing is though? The "big boys" of automotive have a big disadvantage. They're heavily invested in internal combustion engines, unlike Tesla. Almost all of them are still trying to manufacture traditional vehicles while simultaneously sw

    • Tesla is a good 60 plus years behind other auto makers in production tech.

      Tesla makes one model per production line. The standard for other auto makers is eight. Meaning if one model bombs, the company is just fine if the other seven keep the line busy. Tesla can't even manage two.

      Munsk is an amateur when it comes to building physical things ecenomically. Nobody copies him and for good reason.
      • Lol. Your are the first individual that I have seen make that accusation. The fact that he bought the premier robotic manufacturing company probably makes you way wrong.
        • by Rei ( 128717 )

          Indeed, it's one of the most modern car production factories on Earth [youtube.com]. Including using some of the largest robots on Earth. All of Tesla's car production is done at the same place, using the same systems. Model S and X share a common platform; 3 and Y will also share a common platform.

          Tesla has really pushed the boundaries on automation on car production. They show the robot that installs the seats on the Wired video, and how it has to contort to get the seats into position. The Model 3 allows even more in

          • Actually, several weeks ago, must said that Y would be based on 3, so there is some doubt about whether wires will be roboticly installed.
            Of course, the normal approach at any good company with good ppl, is do the right thing and ask for forgiveness rather than permission and have to do the wrong thing. :)
  • Nissan's battery factories are in Japan; Zama and Sagamihara Kanagawa. They'll be shutting those for GSR's Chinese factories.

  • Balancing every single task by oneself, instead of getting some help, can break a person down in record time.

    Nissan is a large company, with lots of people.

    This is either selling assets to pay down debt, or upper management thinking that they can't be competitive as battery manufacturers.

    • Hear hear. Although I'm thinking selling to China (I'm assuming they still have some sort of ownership stake) probably helps them dodge environmental laws.
    • How will Nissan survive both ENGINEERING and MARKETING their cars?!

      Those are two different skills!

  • Adios Nissan (Score:2, Insightful)

    by Anonymous Coward

    There are pros and cons to outsourcing. But if there's one thing that's asymptotic to pure truth, it's never ever outsource your core competency.

    In the case of EVs, your core competencies are Battery Design and EV Drivetrain.

    Outsourcing half your core competency right as the market starts to pick up and get competitive sure seems like surefire way to be left behind.

    • by hipp5 ( 1635263 )

      In the case of EVs, your core competencies are Battery Design and EV Drivetrain.

      Not necessarily. Nissan's core competency is designing and building cars: regulatory compliance, supply chain management, marketing, etc. In fact, they likely have very little (comparatively) competency in battery and EV drivetrain design and production.

      • by DarkOx ( 621550 )

        There is still lots of room to be a good coach builder that drops a car on top of a mostly 3rd party chassis/battery/power train.

        Plenty of auto maker do this to in the ICE powered space. The thing it it usually moves you off into the boutique market space. The majors don't do it that way because there are big advantages in integrated manufacturing.

        You get some design flexibility because you don't have to work round the constraints of someone else's chassis/equipment

        You avoid a lot of overhead, much cheap

        • Arguably the opposite could be true: auto manufacturers today are primarily about service and marketing; slapping a cabin on a slightly value-added chassis makes sense for their model.

          I could also see highly mass-marketed "skateboards" becoming the foundation (heh) of the auto industry-- it lends itself to more customization and is consistent with today's "platform" model.

  • So Nissan gets their engines from Mazda and Cummins and now they'll get their batteries from someone else as well.

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