% Like a group-buy of batteries which reduces per unit costs %

http://www.greenbiz.com/article/what-electric-vehicles-can-learn-solar
What electric vehicles can learn from solar
November 12, 2015  Edward J. Klock,Tyeler Matsuo

[image  
http://www.greenbiz.com/sites/default/files/styles/gbz_article_primary_breakpoints_kalapicture_screen-xs_2x/public/images/articles/featured/shutterstock_nissan_leaf_joel_420.jpg?itok=l7VhchVE
A Colorado pilot project is underway offering pooled purchases of Nissan
Leaf electric vehicles
]

Nissan Leaf electric vehicle pooled purchases

Across the country and around the world, unsubsidized solar energy is
reaching cost parity with fossil fuels. The same cannot (yet) be said for
electric vehicles when compared to gasoline-burning models.

While unsubsidized EVs have not reached cost parity with gasoline vehicles
for the average driver, sales are surging in three Colorado counties with
the help of a tactic that helped make residential solar more affordable to
the mass market.

Inspired by the success of pooled purchasing programs for residential
rooftop solar (sometimes called "solarize" campaigns), Boulder County
invited Adams and Denver counties to team up with Vote Solar — a nonprofit
advocacy organization that administers programs to facilitate residential
solar group purchases — to create Solar Benefits Colorado.

The idea: Engage EV manufacturers and dealers to see if the same rationale
could be applied to pooled purchases of EVs. 

It turns out that the logic can be transferable. Customers can take
advantage of a discount up to $8,600 on a 2015 Nissan Leaf with Quick Charge
Package and zero-percent financing for up to 72 months. The offer was
originally through Oct. 31 and extended through the end of the year. 

This discount, co-developed by the counties, Nissan North America and
Boulder Nissan, brings the entry-level Leaf S down to $23,461 from $31,810
before the federal ($7,500) and state (PDF) (~$5,000) tax credits for which
the Leaf also qualifies.

This pricing is lower than Kelley Blue Book’s estimated fair purchase price
of $28,255, meaning the deal is not only pre-negotiated, but far below what
customers could get by haggling. This deal doesn’t involve tax credits,
subsidies, lobbying, handouts or regulation. It just involves pure business
sense for consumers, dealerships and EV manufacturers alike.

The power of community buying
While EVs enjoy lower operating and maintenance costs than their gas-powered
counterparts, their higher upfront cost can be a barrier to adoption —
either through sticker shock or simply because customers lack the required
initial capital.

There are already measures to address this barrier at the federal and state
level in the form of tax breaks. However, these incentives weren’t driving
EV adoption fast enough for these three communities. Boulder County, for
example, has a goal to achieve an 80-percent reduction in greenhouse gas
emissions from the transportation sector by 2050.

Part of the problem is that tax credits must be claimed at tax time, the
spring following the EV purchase. But incentives available at the time of
purchase have a far greater impact on EV sales. With the upfront discount,
monthly payments are lower, helping to make the Leaf available to more
consumers.

These economics evidently create a compelling incentive to go electric. In
just two months, Boulder Nissan sold over 150 Leafs through the program,
with more than 300 additional people in the pipeline. To put that in
perspective, Boulder Nissan typically sells 15-to-20 Leafs per month (~10
percent of total sales), meaning that its Leaf sales have increased almost
300 percent during the program.

This volume of sales also highlights the benefits of pooled purchasing for
Nissan corporate and the Boulder Nissan dealership — the corporate partners
for this program. In our age of choices and competition, it’s now about
creating marketing economies of scale.

While Nissan sacrifices some revenue by providing the discount, it’s saving
on customer acquisition fees, marketing and even the transaction costs (and
potential customer losses) spent negotiating vehicle prices with prospective
customers. This marketing doesn’t stop when the deal expires, either. Thanks
to the program, there are now 150 new Colorado Leaf owners and counting,
spreading the word and dispelling public misconceptions about EVs. That is
more powerful than any marketing campaign.

Nissan also benefits from the special type of publicity delivered through
the program — community-based social marketing. Instead of Nissan itself
promoting the deal, the program is promoted through a network of
municipalities, universities, large employers and the newest Leaf converts.

Sending the message through a coalition of trustworthy sources — rather than
from the company that stands to benefit from the sales — brings intrinsic
integrity to the deal. Not to mention that packaging the Nissan Leaf
alongside residential solar conveniently targets consumers who are already
likely amicable to buying an EV.

It’s like putting chocolate bars at the checkout counter of supermarkets;
the hungry customers are already there, and you just need to put the option
in their line of vision.

Replicating successful public-private partnerships
While the deal on the Leaf sounds too good to be true, it simply required
bringing together unlikely stakeholders with aligned interests to connect
the dots on a public-private partnership that already made economic sense.

The huge success of the program also lies in the unique value added by each
stakeholder in the chain. At the corporate level, the support to make bulk
purchasing economics and logistics possible was driven by a forward-looking
vision of an EV-dominated market and the need for a critical mass of EVs to
drive this revolution.

At the dealership level, finding knowledgeable and EV-dedicated salespeople
who understand not only the technology but also work to ensure it meets the
customer’s needs, leads to Leaf owners who become EV ambassadors. And
finally, at the grassroots level, the counties pursued and championed the
deal as one that is truly for the greater good.

While Adams, Boulder, and Denver counties deserve credit for the novelty and
boldness to pilot this idea, the beauty of the story is that it’s replicable
across the country. All that’s needed is the will and openness to
collaborate.
[© 2015 GreenBiz Group]




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