Tesla Production
Armen Hareyan's picture

Should Tesla Contracts Nissan To Gain Production Capability

Consider the wait for the Tesla Model 3 there is an idea that perhaps Tesla should contract Nissan to gain production capability. Not have Nissan build the car, but if Nissan took over production capability they could ramp up faster. What do you think?

It looks like both companies could be a good match for one another. Tesla needs to ramp up its production capability, while Tesla needs longer range LEAFs to compete with Model 3.

If Tesla is late on Model 3, those buyers, who have already put an order, may not wait. Yet, Nissan has a lot of production capability. I don't know how a possible deal between Tesla and Nissan would look like, but in the short term Tesla could use some help in that area. Otherwise, what if Nissan publishes to 200-300 range LEAF by 2018? How would potential Tesla Model 3 buyers react? In fact, this new technology could extend Nissan LEAF's range to 338 miles.

"Most car makers don't want to make electrics anyway. Their motivation is to build a few to meet CAFE standards. The dealer model requires them to do a lot of maintanaince. Tesla has disproven the lies they told about electric cars for 40 years. Now they don't know what to do. Build electrics and the dealers go broke. Don't build electrics and the company goes broke," writes an EV enthusiast, named Jack, in one of the Tesla forums on Facebook.

In the same forum, a user, named Rama, writes "I have a model S and drove a Leaf for one day as a loaner. The Leaf is ugly and awkward. I couldn't believe how poorly designed the interior is and how complicated is the dashboard. The visibility is terrible. Instead of blaming Tesla, why doesn't Nissan build a better product?" And yes, Nissan, did point to a Model 3, with an ad in April 2016. See it in this comparison of Tesla Model 3 vs Nissan Leaf.

Nissan had basically no competition when it started producing the LEAF. In the same way, Toyota didn't have serious competition when producing Prius. People who wanted an electric car or a hybrid, didn't care how these cars looked because there were no alternatives at the time of the start, or the alternatives were much more expensive.

Now the situation is much different. It's both competition and mutual need: Tesla has the technology, but needs time to produce and delivery capacity. Nissan has the capacity, but lacks the appeal that Model 3 enjoys. Is there match for a partnership?


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