
Nissan to expand global reach with electric vehicles made in China
Japanese automaker Nissan Motor, has announced a strategic move to sell electric vehicles (EVs) developed in China across the global market. This decision, influenced by China’s lower manufacturing costs, signifies a shift in the automotive industry’s approach to EV production.
Nissan’s Global Strategy
Nissan’s plan to sell China-developed EVs worldwide reflects the growing influence of Chinese automotive manufacturing. The company aims to leverage China’s cost-effective production capabilities to enhance its competitive edge in the global EV market.
Chinese carmakers, such as BYD, Nio, Xpeng, and Li Auto, have gained a significant advantage in the EV sector, partly due to their control over the supply chain. This dominance helps keep costs low and enhances their global competitiveness. BYD, in particular, has seen success with its affordable Seagull model in China and the competitively priced Dolphin hatchback in the UK.
Nissan’s response to market changes
In response to the shifting dynamics in the EV market, Nissan plans to sell its China-developed EVs in key markets, including Southeast Asia and Europe. This move aligns with the strategies of other major automakers like Tesla, Ford, and BMW, which are also expanding exports of China-made cars.
To better understand the Chinese market and develop strategies that resonate with local customers, Nissan will establish joint research efforts on EV technology with Tsinghua University. On December 18, Nissan (China) Investment Co., Ltd. announced the establishment of a joint research center between Nissan Motor Co., Ltd. and Tsinghua University for new joint research to begin in 2024. The scope of the research will focus on effective communication for Generation Z (Gen Z), as well as the role and social responsibility of automakers in EV ecosystem, including charging infrastructure, battery recycling, re-use and energy management.
Nissan and Tsinghua University are also strengthening the partnership through a memorandum of understanding on comprehensive cooperation in the joint research project, including on-going joint research, and human resource development and exchange, which have been engaged in since 2016.
The cooperation with Tsinghua University is allowing Nissan to deploy strategy development in the era of electrification and intelligent mobility, while contributing to sustainable development and its commitment of โin China, for China and worldโ.
Nissan President and CEO Makoto Uchida said: โWe hope that this collaboration will help us gain a deeper understanding of the Chinese market and develop strategies that better meet the needs of customers in China, and contribute to sustainable development by returning the results of our joint research to the Chinese economy and society.โ
China’s cost advantage in EV manufacturing is prompting legacy automakers worldwide to prioritise cost-cutting strategies. Ford CEO Jim Farley acknowledged the challenge posed by Chinese competitors, emphasising the need for legacy automakers to adapt to remain competitive.
Quality perceptions and market dynamics
While some may perceive Chinese EVs as lower in quality, industry leaders like Tesla CEO Elon Musk have recognised the competitiveness of Chinese carmakers. Musk praised China’s manufacturing prowess and work ethic, highlighting the country’s significant role in the EV market.
In the United States, subsidies under the Inflation Reduction Act (IRA) currently offer some protection against Chinese EVs. However, industry executives anticipate that Chinese automakers will eventually enter the U.S. market, potentially through production facilities in Mexico.
In the United States, subsidies under the Inflation Reduction Act (IRA) currently offer some protection against Chinese EVs. However, industry executives anticipate that Chinese automakers will eventually enter the U.S. market, potentially through production facilities in Mexico.