Electrical Cars Gain Popularity in Britain

on Nov 13, 2012
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In November the Society of Motor Manufacturers and Traders’ (SMMT’s) annual Automotive Innovation Award will be presented by Nigel Stein, chief executive of GKN and president of SMMT. According to The Times, which supports the event, electrification will be a highly discussed topic.

There are currently numerous innovations in the car manufacturing industry including leaps in the efficiency of the internal combustion engine; in safety, avoidance, collision and smart braking systems; in the process and materials used in manufacturing. These advances are remarkable yet they don’t make it into the six innovations shortlisted by the SMMT. Instead, five of them are related to hybridisation and electrification.

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Mr Stein is not surprised by this year’s focus on electrical cars: “It is a core competency of the industry in this country.” He is not convinced however that the electrical car revolution has arrived. “I have always argued it was going to be like the dot-com boom and that has how it has shaped up,” he said for The Times. “People thought in 1999 that everybody would move straight to buying everything online. Massive disappointment. Then a decade later it happened and now everybody buys online. You are going to see exactly the same in electric cars. Electrification was never going to happen over two or three years. It was always going to happen over longer. The hard work of the last ten years is paying off and over the next ten years we will see the electrification agenda begin to take hold.”

According to Mr Stein the government shouldn’t be picking winners in the industry but companies which show the innovation and courage to venture into the electric-car manufacturing business should be supported.
One of these risk-takers is Nissan.
**Nissan Takes a Bid on Electric**
Near its world-leading plant in Sunderland, Nissan (TYO:7201) is planning to start assembly of the Leaf electrical car in a new and better manufacturing plant, part of a project with a total cost of £420 million. About 60,000 battery packs will be produced for both Nissan and its partner Renault.

As Michael Wynn-Williams from The Times points out the investment carries high risk and thus it is vital for Nissan to hit full capacity production. With the fixed costs per unit for battery packs several times higher than for conventional engines, Nissan needs to see a return on its investment soon.
Britain’s market for electric cars is still very limited – only about 0.8 percent of total new car sales. In the whole of Western Europe there were about 25,000 units sold for the year and Nissan can claim only a share of that number. The low demand is not only due to the mileage constraints of electric cars but also their price. Even with government subsidies the Leaf is priced at more than £25,000.

**Renault Introduces Zoe**
Renault (EPA:RNO)has proven prices can be lower – for the first time last weekend the company took its Zoe electrical car onto the roads of the UK. The basic model has a price tag of £13,650, almost half the price of Nissan’s Leaf and not much farther from the petrol equivalent.
!m[](/uploads/story/794/thumbs/pic1_inline.png)”At that sort of price it does bring it into the budget of most mass-market small cars,” said Andy Heiron of Renault UK.
The range of the Zoe is also larger than other electrical cars – it can go for about 130 miles on a single charge. The catch is that Renault will charge owners a monthly fee of about £80 to rent the battery, on top of the cost of the car.

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