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Scott Edward Anderson is founder of VerdeStrategy, a consulting and advisory firm focused on the cleantech, energy, and environment sectors, and the popular blog TheGreenSkeptic.com, as well as a frequent commentator on FOX Business Network. He has over 20 years experience in management, marketing, fund raising and business development. He has held management positions for large institutions, such as The Nature Conservancy, the world's most successful global conservation organization, and Ashoka, a social venture capital organization with operations in 72 countries worldwide, and has consulted with dozens of businesses and social entrepreneurs around the globe.

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Nissan Leaf Tries to Jolt Sales vs. Chevy Volt with TV Ad

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Posted May 31, 2011 with 755 reads

Keywords: Chevy Volt, cnet, ev, marketing, nissan leaf, Transportation

Nissan Leaf is losing ground to its hybrid competitor the Chevy Volt. In fact, some report that Volt has been kicking Leaf's butt -- or at least blowing Leafs off of the lawn?

So Nissan has decided to take on Volt the old-fashioned way: with a TV spot that CNET featured this morning and that will air on June 12 during the NBA Finals.

Imagine a world where all our appliances are gas-powered and you've got the world Nissan wants us to think we live in.

The ad is funny, inventive, even a little steampunk.

While it's message is delivered in a tongue in cheek manner, it is also a little disingenuous. Most of your all-electric Leaf mileage will be powered by dirty coal.

Nevertheless, its a spot that will no doubt have people talking, much like last year's Polar Bear ad.

Here is the 60-second version: Gas-Powered Everything.

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TRONZ said:

The Volt just got destroyed in the May sales numbers. GM sold only 481 Volts. Nissan sold 1,142 LEAFs! Funny opinion write up. I have seen several LEAFs zipping around but not once being towed. HOWEVER, I have seen two Volts getting fill ups at our gas station.

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Wed, 2011-06-01 19:12 — TRONZ

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Jeff R. said:

Total FUD article.

Why is it okay to subsidize big oil, but not alternative fuel vehicles?

Why is the charging source of battery packs brought up as being coal, but the amount of electricity used for refining gas and diesel never brought up?

Burning gasoline one vehicle at a time will always be dirty, the nation's energy sources for electricity get cleaner every year. California uses very little coal for its electricity, but even if it did, a large power plant will always be more efficient than an inefficient combustion engine in every car. EV's are 90% efficient, ICE cars are 20% efficient.

My wife drives a Leaf powered by our solar array.

So we can either do what the Saudi Prince wants us to do, stay with the status quo or we can push forward with alternate fuel vehicles--which one points to a better future?

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Wed, 2011-06-01 11:18 — Jeff R.

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Geoffrey Styles said:

"Why is it okay to subsidize big oil, but not alternative fuel vehicles?"

It boils down to the magnitude of the subsidy. At the commonly quoted figure of $6 billion per year for oil & gas tax incentives, their "subsidy" equates to about $0.025/gallon. However, on the basis of the 2,400 gallons of gasoline a Leaf will save in 10 years of being driven 12,000 mile per year, compared to its closest gasoline-powered competitor, the Prius, the current $7,500 EV tax credit works out to $3.12/gallon. When you consider that a million EVs will save less than 35,000 barrels per day of oil, or just 0.3% of US gasoline consumption, how cost-effective does that look?

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Wed, 2011-06-01 13:47 — Geoffrey Styles

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Jeff R. said:

Great point Geoffrey, but we must not forget the cost of pollution on the health of society, nor the cost of wars waged in part due to oil. or the cost of having the military police the oil shipping lanes. I believe the true cost of a gallon of gas is much more expensive than that paid per gallon at the pump. Some costs aren't financial, but moral and quality of life related.

Please remember that governments of other countries subsidize or will subsidize EV's made by their manufacturers, just as they do solar panels and other green tech. If the US doesn't do so as well, we will be at a big disadvantage on a global basis.

Why not take those oil subsidies and put them into alternative fuel research? Why not back something other than the status quo? We don't owe it to the Saudi Prince to continue to spend $250 billion every year on foreign oil.

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Wed, 2011-06-01 22:30 — Jeff R.

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Geoffrey Styles said:

If you really don't want to spend that much importing foreign oil, your best bet for now is producing more here. To do that, the industry needs a competitive tax structure, which for now means high marginal rates offset partially by the incentives you are against. A lower corporate tax rate, combined with elimination of most current tax credits and deductions, would fix that. As for the other externalities, they exist, but they don't add up to $3/gal.

EVs just can't have enough impact soon enough; the math is clear. They're a long-term solution, and that's important, but they don't help in the short-to-medium term.

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Thu, 2011-06-02 08:09 — Geoffrey Styles

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Jeff R. said:

Geoffrey, again, the cost of oil is more than foreign sources, it's pollution and health related, domestic or foreign.

Drill baby drill in the US would not be a short term fix, nor would the percentage of oil resources gained be much--but I'm pretty sure it would be just as expensive as oil from Canada and the Middle East, oil is a world market.

Give EV's ten years of billions in government incentives and R&D dollars and we might see more traction than many would expect. I don't think a million EV's by 2020 is that hard to achieve. I'd much rather see us reach for that than more deep sea drilling or Alaska nature reserve drilling.

Everybody who's gone for a ride in our Nissan Leaf has been impressed. More exposure to EV's usually means more understanding and enthusiasm for them.

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Fri, 2011-06-03 01:00 — Jeff R.

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willem Post said:

Geoffrey,

Why compare an EV it against a Prius?

For a typical car using gasoline at 22 mpg and 36 m/d, the cost would be about 36 miles/d x 1 gal/22 miles x $4.00/gal = $6.55/d. The dollar savings would be about ($6.55-$2.16)/d x 365 d/yr = $1,602.35/yr. The fuel savings would be about 13,200 m/22 mpg = 600 gal/yr, or 6,000 gal over the 10-yr life of the car. The subsidy is about $7,500/6,000 gal = $1.25/gal.

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Wed, 2011-06-01 18:11 — willem Post

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Geoffrey Styles said:

Willem,

Although the result of your calculation is still orders of magnitude more than the incentives for oil & gas that Jeff R. was comparing to EV subsidies, in my view it doesn't make much sense to compare an EV to an average car, particularly for the early adopter segment. Non-plug-in hybrids have raised the fuel economy bar, and the batteries in one Leaf would equip something like 8 Prius-type hybrids, saving far more fuel and without the need for subsidies. I continue to believe that EVs will be an important segment of the car market in the decades ahead, but I'd prefer to see a more rational strategy for EV incentives, particularly since the billions spent on that won't be spent on something else--or will add directly to the debt.

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Wed, 2011-06-01 18:23 — Geoffrey Styles

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willem Post said:

Geoffrey,

I like your statement about 8 Prius vehicles using the same size battery as one Leaf.

These 8 Prius vehicles would reduce gasoline consumption an order of magnitude more than one Leaf during their 10-yr lifes and, as you state, without any subsidies

Shall we call it another renewable-ism, industrial policy folly having nothing to do with economic and global warming efficiency?.

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Wed, 2011-06-01 19:29 — willem Post

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willem Post said:

All,

The above is a distracting diversion. The big picture is that EVs are NOT ready for prime time and the infrastructure to support the EVs is lacking. The US should not be subsidizing this industry; it needs to reduce out-of-control budget deficits.

All this hype about so many millions of EVs by such-and-such a date is distracting and diverting the US from real solutions that have immediate payback, such as increased energy efficiency.

The real issue regarding CO2 reduction is energy intensity, Btu/$ of GDP; it must be DECLINING to offset GDP and population growth. To accomplish this energy efficiency needs to be at the top of the list, followed by the most efficient renewables of which hydro power is the best and residential small wind is the worst, in fact, it is atrocious. EE is so good that it should be subsidized before any and all renewables and EVs, because it is much more effective per invested dollar.

Effective CO2 emission reduction policy requires that all households eagerly participate. Current subsidies for EVs, residential wind, PV solar and geothermal systems benefit mostly the top 5% of households that pay enough taxes to take advantage of the renewables tax credits, while all other households are required to pay for them by means of fees and taxes or higher electric rates; the net effect is much cynicism and little CO2 reduction. Improved energy efficiency policy will provide much greater opportunities to many more households to significantly reduce their CO2 emissions.

Energy efficiency will have a much bigger role in the near future, as energy system analysts come to realize that tens of trillions of dollars will be required to reduce CO2 from all sources and that energy efficiency will reduce CO2 at a lesser cost and more effectively. Every household can participate.

Energy efficiency projects:

- will make the US more competitive, increase exports and reduce the trade balance.

- usually have simple payback periods of 6 months to 5 years.

- reduce the need for expensive and highly visible transmission and distribution systems.

- reduce two to five times the energy consumption and greenhouse gas emissions and create two to three times more jobs than renewables per dollar invested; no studies, research, demonstration and pilot plants will be required.

- have minimal or no pollution, are invisible and quiet, something people really like.

- are by far the cleanest energy development anyone can engage in; they often are quick, cheap and easy.

- have a capacity factor = 1.0 and are available 24/7/365.

- use materials, such as for taping, sealing, caulking, insulation, windows, doors, refrigerators, water heaters, furnaces, fans, air conditioners, etc., that are almost entirely made in the US. They represent about 30% of a project cost, the rest is mostly labor. About 70% of the materials cost of expensive renewables, such as PV solar, is imported (panels from China, inverters from Germany), the rest of the materials cost is miscellaneous electrical items and brackets.

- will quickly reduce CO2 at the lowest cost per dollar invested AND make the economy more efficient in many areas which will raise living standards, or prevent them from falling further.

- if done before renewables, will reduce the future capacities and capital costs of renewables.

http://theenergycollective.com/willem-post/50925/electric-vehicle-hoopla

http://theenergycollective.com/willem-post/46652/reducing-energy-use-houses

http://theenergycollective.com/willem-post/57905/wind-power-and-co2-emissions

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Wed, 2011-06-01 08:27 — willem Post

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Amelia Timbers said:

Willem, you should write some more energy efficiency posts! You're clearly very passionate about it, and I'm with you. It's such a no-brainer issue, but has a strangely slow adoption curve. Have you seen the posts we've hosted lately from the American Council for An Energy Efficient Economy? cheers, Amelia

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Wed, 2011-06-01 10:55 — Amelia Timbers

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wt said:

As an owner of a Leaf I will heartily disagree that EVs are "NOT ready for prime time and the infrastructure to support the EVs is lacking".

The Leaf is perfect for my surburban family with a second car capable of longer ranges (there are a lot of us). My wife commutes to work in it - it's a 26-mile round trip, and she pays about 1/4 the price she would with a gas-guzzler. That's including the surcharge we pay our utility for 60% renewable energy, which makes our CO2 footprint many times smaller than an ICE vehicle.

The car is charged on a timer overnight, and if every car in my community was a Leaf my utility would be more than capable of handling the load. And public charging stations are a red herring - longer range, cheaper batteries will make them largely unnecessary.

Oh, did I forget? It's just a great car. It's quiet as a mouse (for the first time I can listen to classical music in a moving vehicle and hear every nuance). It carries 5 comfortably. Its pin-your-back-to-the-seat acceleration is the best of any car I've ever owned, as is the handling that comes from putting 450 lbs of batteries in the center of the car beneath axle-level.

I agree that energy efficiency should get top priority, but there is room for EV subsidies in the mix. It will take a decade or so to achieve the market penetration that will truly make a difference. In the meantime, manufacturers need an incentive to invest in R&D.

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Wed, 2011-06-01 10:46 — wt

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Houstondav said:

I think you got your facts wrong. The Volt is not kicking LEAF's but. Maybe only in US sales, for now. Leaf did out sell Volt in April sales. The months prior Dec-Mar Volt won in US only because they were trying to fill the Japanese orders first due to an incentive that expired 3/31 in which they sold over 7000 for a world wild sales number of over 8000 Leafs compared to 1600 Volts worldwide, oh sorry Volts are only sold in US. Looking forward to May's numbers where Leaf jumps ahead of Volt sales even if just looking at US. With a little shopping you can find a Chevrolet dealer who has a Volt on the lot collecting dust waiting for buyer. That can't be said for the Leaf as every single car off the line is already sold. They are not building Leafs to sell at dealers. They are building them to fill orders and already there is a year wait to get one. Volt out sale Leaf, I think not.

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Wed, 2011-06-01 07:23 — Houstondav

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Houstondav said:

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Wed, 2011-06-01 07:23 — Houstondav

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Hmmm said:

The ad is clever. LEAF and Volt don't really compete. Volt and Prius are more likely rivals.

Your opening statement is bogus. LEAF sales have dominated Chevy Volt since day one. LEAF is sold in more countries than just USA. Early sales stayed in Japan due to expiring tax benefits.

By the end of Feb, there were already 3600 LEAFS sold to 908 Volts.

http://green.autoblog.com/2011/03/11/nissan-leaf-sales-3657-four-times-m...

Agree with your last statement.

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Wed, 2011-06-01 00:19 — Hmmm

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Geoffrey Styles said:

Scott,

The ad is hilarious. The gasoline-powered pc and dental drill are very clever. Perhaps Chevy could counter this with an ad featuring a long line of flatlined Leafs (Leaves?) hooked up to tow trucks.

The bigger question is whether the basic assumption behind the ad is correct: that potential Leaf buyers are being lured away by the Volt. I'd bet not, since they are such different cars, offering such different mobility/value propositions.

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Tue, 2011-05-31 18:09 — Geoffrey Styles

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