Don’t look for a flood of new Nissan Ariya electric vehicles at your local Nissan dealer anytime soon.
According to a Reuters report, issues at the new Ariya electric vehicle’s high-tech production line have slowed down delivery of the vehicle, part of the company’s intended comeback.
Actual production is running at two-thirds of expectations, due to problems with the highly automated manufacturing system created for the model at Nissan’s Tochigi plant, north of Tokyo. Built at a cost of ¥33 million, or $243 million, the assembly plant is designed to manufacture vehicles with internal combustion engines, gas-electric hybrid, or battery-electric powertrains on the same production line.
Problematic production
But getting it to work as planned has proven to be “an incredibly, extremely high challenge,” according to the report.
It seems Nissan is facing the same semiconductor shortages affecting all automakers, as well as the dearth of another electronic part after a fire at a supplier factory in China. Nissan also stated it faced shipping problems as well as difficulties with the plant’s paint line, one that’s designed to paint the entire car at the same time, including its body and bumpers.
Nissan previously planned to make some 9,000 Ariyas a month, or more than 100,000 units annually. But the expectation is that the automaker will only be able to build less than 6,900 of the EVs in April and 5,400 in May.
U.S. and Japanese Nissan dealers stopped taking orders for the new EV last year.
The reduced production of the battery-electric vehicle could hurt Nissan, which it revealed in 2020 as its first EV since the Nissan Leaf debuted in 2010. Despite Nissan’s early lead in electric vehicles, its lack of a follow up for a decade allowed Tesla and others to grab a market that it could have dominated. Now, they must belatedly play catchup.
The vehicle follows the introduction of the redesigned Nissan Z sports car and pathfinder utility vehicle in 2022.
A Stalled Comeback
The automaker’s new global vehicle comes to market as the company is trying to right itself after years of internal turmoil following the arrest of former CEO Carlos Ghosn and the renegotiation of its alliance with Renault.
The Renault-Nissan-Mitsubishi Alliance has expanded as a result of additional agreements made last month, according to a statement from Renault Group and Nissan Motor Co. Nissan will buy 15% of Renault’s Ampere EV unit as part of the agreement, maintaining its 15% cross-shareholding relationship. Nissan and Renault Group have both signed a legally binding framework agreement that will hopefully become a final deal by the end of March, with completion anticipated for the fourth quarter.
But the new plan hasn’t charmed investors. Nissan’s debt rating was downgraded earlier this week by S&P Global Ratings to junk status due to lower-than-anticipated profitability and sales volumes as the company struggles to regain lost market share. Nissan’s U.S. sales dropped 26% in 2022, while its Infiniti luxury division posted a 20% sales decline during the same period.
Nissan’s EV production shortfall isn’t unique, however, as all EV automakers have faced reduced production in the wake of parts shortages, most acutely semiconductors and batteries
With a starting price of about $43,190, the Nissan Ariya undercuts the $53,990 Tesla Model Y by $11,800.