Renault-Nissan-Mitsubishi Alliance Claims It's Alone in Making a Profit off EVs

The Nissan LEAF is still the world's all-time best-selling EV, but with just over 350,000 units to date, it probably won't be enjoying that position for long.
Carlos Ghosn 1 photo
Photo: Nissan
Tesla revealed it had built its 300,000th vehicle, so it's hot on its tail and, should the Model 3 production reach its goal output, we could have a new leader over the next year or so. Meanwhile, the Renault ZOE continues to be Europe's EV of choice, though the market for electric cars there is mostly restricted to a few countries.

Mitsubishi was among the first brands to offer a fully-electric car, but it wasn't part of the alliance back then (plus it was a complete flop). The i-MIEV was developed together with Citroen (C-ZERO) and Peugeot (IOn) and was a small city car with very limited range and an awkward design that made it look as though it had sat between two tracks as trains ran in both directions at the same time. In other words, the Japanese brand doesn't really count in the electric efforts of the alliance at the moment.

Making money off electric cars has been a problem traditional manufacturers, which could explain why there was no rush to build them in large numbers. For instance, FCA's CEO, Sergio Marchionne, declared that his company would make an EV the moment they became profitable and famously asked people not to buy the Fiat 500e because the Italian brand was losing money with it.

Similarly, it was estimated - though never confirmed - that General Motors is also losing a few thousands of dollars with every Bolt hatchback it sells, but was forced to drop the asking price to be able to compete with the Model 3.

The Renault-Nissan-Mitsubishi alliance, however, thinks it may be the only one that has managed to make EVs profitable. Its CEO, Carlos Ghosn, told CNBC: "We are probably the most advanced carmaker in terms of costs of electric cars and we have announced already in 2017 that we are probably the only carmaker who's starting to make money selling electric cars."

"We know that there's a steep curve before you start to make money out of electric cars," he continued. "I think we are well advanced." He also offered a valid insight on why the growing price of raw materials shouldn't influence the price of EVs: "The increase in the cost of the raw material would be compensated by much better knowhow into how to make batteries more efficiently and how to substitute some of the raw materials going into the batteries."

Nobody can deny Renault-Nissan-Mitsubishi's expertise in building EVs, it's just that its products have been lacking in performance so far compared to the competition. Even the new LEAF, launched last year, was a disappointment, with the 2019 model promising to right some of the wrongs - most notably its range. The clients don't care whether the company makes money off the car they buy or not, but how the vehicle is, which is why they will always go for a similarly-priced Tesla over a Nissan or Renault if it has better specs.
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About the author: Vlad Mitrache
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"Boy meets car, boy loves car, boy gets journalism degree and starts job writing and editing at a car magazine" - 5/5. (Vlad Mitrache if he was a movie)
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