Last year it was the Chevy Volt, which went through several months of slow sales before rebounding in the spring.
This year, it’s the Nissan Leaf, the world’s highest-volume battery-electric car, whose U.S. sales have slumped to just 600 a month or less–and stayed there since early this year.
Just 3,148 Leafs were sold in the first six months of 2012, fewer than the 3,875 delivered from January to June of 2011.
According to Al Castignetti, vice president of sales for Nissan Division in the U.S., monthly Leaf sales will remain at a level of 500 to 1,000 cars a month until December.
That’s when the revised, U.S.-built 2013 Leaf model starts rolling off assembly lines in Smyrna, Tennessee–interspersed with Nissan Altimas, Maximas, and other gasoline cars.
He stuck with the prediction that Nissan will deliver a total of 20,000 Leafs in the U.S. by the end of March 2013, however.
Yesterday, Green Car Reports interviewed Castignetti about low Leaf sales in 2012.
He attributed the results to three factors:
(1) Lumpy transition to dealer wholesaling
By far the biggest factor in the low sales numbers, Castignetti said, was the March 1 transition from a centralized reservation and assignment system to a more traditional dealer wholesaling model.
Rather than delivering Leafs to local dealerships only after a buyer has been confirmed, Nissan now ships electric cars to its dealers either to fulfill dealer orders or as part of a mix of vehicle allotments.
The move was made, he said, because Nissan didn’t feel the online “Nissan journey” model of taking reservations and assigning cars individually could scale to the volume of orders it expects in 2013.
“That was OK at the start, with low volume” in the first year, Castignetti said.
But next year, Nissan can build up to 12,000 Leafs a month in Smyrna if sales demand.
What on earth makes Nissan think it can sell up to 50 times as many Leafs each month?
Upgrades for 2013 Leaf models
“We have things planned for the [updated] 2013 model that will help it in the marketplace,” Castignetti said–which likely include a better heater, available leather seats, and an optional 6.6-kilowatt charger.
The U.S.-built 2013 Nissan Leaf could also be less expensive than earlier models built in Oppama, Japan, which suffer from the historically high Yen-dollar exchange rate. U.S. Leafs will use U.S.-built lithium-ion cells in their batteries.
At the same time as it started shipping Leafs direct to dealers on the wholesale model, the company completed its rollout of the Leaf across all 50 states.
That meant it had to fill a delivery pipeline with Leaf models, fitted with the options most appropriate for given regions, to dealers throughout the country–not just early adopter states like California, Oregon, and Washington.
Fine-tuning that process has taken time, he said, in figuring out where to allocate vehicles.
“I’ve got 3,000 Leafs in dealer inventory now, but some dealers still have zero cars,” Castignetti said. “It’s a dispersion issue.”
(2) Misunderstanding of how different Leaf buyers are from other Nissan customers
The bigger issue, he admitted, was that Nissan greatly underestimated the effort required to market electric cars at the local level.
“We learned it was somewhat naive to assume we could wholesale the Leaf like an internal-combustion car,” Castignetti said.
“No one walks into a Nissan dealer, crosses over from an Altima, a Maxima, or a Pathfinder, and decides to buy a Leaf instead.”
“We thought dealers would take the car just like any other, but it’s a totally different audience,” the sales chief acknowledged.
“You have to be an electric-car person to buy a Leaf at this stage–and we did a poor job of educating dealers how to market the car, and who to market to.”
So now Nissan encourages dealers to participate in electric-car groups, environmental causes, and other local activities where likely electric-car buyers may be found.
“You need to be included in these kinds of events,” Nissan is telling its dealers, Castignetti said, among “this audience, the green community.”
“That’s our biggest challenge.”