Nissan is transforming vehicles into a moving source of energy

23 Nov Nissan is transforming vehicles into a moving source of energy

Bruno Matucci, Managing Director of Nissan Spain & Portugal, explains how the Nissan Leaf is already homologated in Europe and using V2G technology in Barcelona which fuels the grid while earning money for its owner.

You have been in charge of Nissan Spain and Portugal since the late summer of 2020. How do you find the Spanish and Portuguese markets, and what is the importance and role of Spain and Portugal for Nissan’s European strategy and manufacturing?

Iberia, from an outsider’s perspective seems to be a homogeneous market. However, a closer look reveals quite a different story. In Spain we have one of the most aggressive markets in Europe. Spanish customers have an advantage in that they pay five to eight percent less for a vehicle than consumers in other parts of Europe. This is not the case in Portugal. We need to look at the market under normal circumstances, because today’s figures are skewed due to the semiconductor shortage, and, of course, the pandemic. The Spanish market typically has no dominant brands. Its top 10 players are within four market share points of each other, unlike Italy, for example, where the gap between the first and the tenth spot is 12, and historically has been even wider. Here you do not have a small few driving the commercial strategy of the country, which makes playing in the Spanish market more difficult, but more interesting.

Another element is electric mobility. Even though alternative fuels, mild hybrid, full hybrid and the plug-in hybrid, are experiencing double-digit monthly growth, Spain, is unfortunately at the lower level of Europe with a market share of around 2 percent when it comes to purely electric vehicles. The challenge in Spain around going fully electric is much bigger than in other European countries. Although diesel is being phased out in the country in general, in the fleet market which for the first time in 10 years has overtaken the private market, over 30 percent of its owners are still buying diesel. In Nissan we have decided to move away from the diesel market, so this trend represents an additional challenge for the future.

Portugal, as I said, is very different from Spain. Here we see a more, shall I say, showoff market, where luxury brands like BMW and Mercedes are constantly within the top five. This is an expression of consumers that still perceive cars as a projection of themselves, as part of their identity. This rationale is becoming less and less important in many European countries. There is a trend towards a more rational rather than an emotional approach to car purchases, especially among the younger generations. Outside of sports car enthusiasts, they look at cars more as a means of getting from A to B. There is a second peculiar dynamic in Portugal which is that on the one hand, you have diesel still representing more than 34 percent of the market in Portugal, while on the other hand the electric vehicle development has advanced substantially. Today 6.6 percent of the total Portuguese market is pure EV which puts Portugal on a par with Germany or even France. In this respect, Portugal is a huge opportunity for us being that one of the key pillars in our roadmap is electrification.

How has Nissan responded to the current unprecedented crisis due to, among other factors, a change in habits, particularly true among younger generations, who are less interested in owning a car and more interested in less polluting solutions?

The crisis we have faced in the past two years with the pandemic and all of its consequences, as well as noteworthy events involving climate change have certainly caused consumer demand to shift towards a greener type of mobility. Consumers are increasingly interested in environmentally friendly goods and elements which can be used in the circular economy. Cars unquestionably fall under that category. We anticipated this kind of customer expectation. Nissan was the first brand to develop a fully electric vehicle aimed at the mass market way back in 2010, long before the current crisis and trends.

We also have a very specific vision which is important to emphasize. Different from other manufacturers, our idea of an electric vehicle is not just about replacing the engine, rather it is about transforming the vehicle into a moving source of energy. This puts vehicles into a different context than just being seen as a means of moving goods or people. We have done this by using a specific technology called Vehicle-to-Grid (V2G). Today our Nissan LEAF is the only vehicle homologated at the European level to use this kind of technology.

In almost every country in the world we have massive car parks and these vehicles are doing nothing more than taking up space. Now, let’s imagine that 90 percent of them are connected to a grid or an energy distribution infrastructure through a bi-directional charging point. All of these vehicles could function as an energy warehouse to be used by the community any time they need energy. An added advantage is that we have solved the limitation that other types of renewable sources have, which is that it is not always available. Solar and wind, for example, need a storage system in order to work efficiently. With V2G technology we use vehicles to store energy and give it back to the grid when it is needed while also compensating participating costumers. Not only are you contributing to a greener world, but you can also save money by essentially renting out your battery. The energy provider is quite happy to pay because it means they did not need to invest in building their own storage facility. Tests in the U.K. and in the Netherlands have shown that a family with an electric car driving 15,000 kilometers per year, which is the standard, could earn up to 800 euros per year. This utterly changes the concept of fuel as a cost. In fact, you no longer consume fuel, but you have energy which additionally becomes a source of revenue. This is how we plan to transform mobility. Yes, let’s go electric, but let’s make it more than just a means of transport. For us, a vehicle is a moving storage unit that can be taken advantage of to grant and increase production from green sources, and at the same time allow consumers to reduce the cost of ownership of a vehicle.

This is something that we can put in place right now, today. This is not some futuristic fantasy. It only comes down to the political disposition to do so. There is no technical barrier involved. If you consider that today, in countries like Spain, Italy, Germany, and France people are already receiving compensation for the energy coming from the solar panels on their houses. There is no reason the same thing cannot be done with vehicles.

Alongside electrification, what are some other key trends that are shaping the industry and how do you see disruptive technologies affecting the automotive industry?

If you listen to the declarations of the CEOs from all of the major manufacturers, you will notice that all products are basically being developed along three lines. The first is electrification. The goal is to have 100 percent electric vehicles. Some are saying they will accomplish this in 2035, others 2040, and others 2050. Whatever the case, we all agree that the electric vehicle is the vehicle of the future. The second trend is about connectivity, meaning a car is not a standalone element, rather it needs to be part of a system wherein vehicles are connected to one another and to external infrastructure in order to make drivers’ lives easier and to improve safety. The third one is autonomous driving which will free up drivers to do something else, be it work or leisure activities.

The combination of these three is absolutely dependent on the development of new technology which revolves entirely around 5G. It is key for the connectivity necessary for the Internet of Things, which includes driverless solutions and smart signs which communicate with vehicles informing them of free parking spaces or if there is an issue at an intersection. This also involves, of course, artificial intelligence, because the vehicle needs to learn by experience in order to build its memory and try to improve the way it acts the next time it faces the same situation.

In Nissan, the entire new generation of our current vehicles will be fully electric. To bridge the gap between the present state of things and fully electric vehicles, we have patented a technology called e-POWER. This means that the vehicle uses an electric engine and battery to move the wheels and uses a generator only to recharge the battery. It is a hybrid solution internally, but with a fully electric driving experience. This will help drivers get used to electric driving, which is completely different and much better than the hybrid or traditional gasoline or diesel vehicle experience. At the same time it can be used as a transitional solution, because until we have a fully developed charging infrastructure, we need something that can guarantee the vehicle’s autonomy. This technology allows people to drive in electric mode without having to rely on charging infrastructure. For everyday needs it is more than enough. Statistics show that over 80 percent of people are doing less than 100 kilometers per day. One could use an EV today without any issues but people tend to be skeptical and go right to the worst-case scenarios. With this new Nissan-patented technology drivers are able to do 650 to 800 kilometers with no problem at all.

Where, in your view, should national and regional governments invest next generation funding?

Now that we have all decided to move on to a world where all vehicles are electric, the issue now is how do we manage the transition and how long should it take. At Nissan, we strongly believe that this changeover has to be shortened as much as possible. To achieve that we have a specific proposal, which focuses on allocating funds to developing the charging infrastructure and to financially helping consumers make the move to electric vehicles because in the next two or three years, the prices of electric vehicles will be much higher than standard vehicles. The effectiveness of this strategy has already been demonstrated in northern Europe. For example, the Norwegian government put measures in place to promote the development of the charging infrastructure and several economic advantages for EV owners, and the market has soared. Last October more than 65 percent of vehicles sold in Norway were pure electric. This proves that if we can just reduce the barriers of infrastructure and price, people are ready to move to EV.

Is Barcelona, in your opinion, the current Mediterranean hub for innovation? What can you share about your Barcelona-based company, and does Nissan support startups or any innovative disruptive projects?

From what I see here in Barcelona, there are a great deal of initiatives which are going in the direction of making urban mobility greener and of more multimodal initiatives such as bike and carsharing, not to mention the sophisticated underground. There is fertile ground to establish a thriving green innovative ecosystem and more and more new initiatives are popping up all over. This is also due to Barcelona’s tremendously international nature.

At Nissan, we do have a car sharing initiative and we have a related project which is currently under development, so I cannot give any details yet. However, I will say it is a project about sharing but in a bit of a different way than what you are used to. Unfortunately, the current semiconductor shortage situation and the pandemic is not helping us put new initiatives in place, because we are trying to satisfy the demands of our private customers.

To the question is Nissan looking at how to participate differently than just selling cars, the answer is a big yes. In Barcelona, we still have our technical center used by Nissan worldwide to test innovative solutions. The technical center in Barcelona is currently working on how to adapt e-POWER to the European road and driving conditions. e-POWER has been developed and is currently working in Japan. To make it compatible with European consumers’ expectations, it needs to be reworked, and it is in Barcelona where we are doing this for the whole European region.

The technical Center in Barcelona is part of Nissan’s global technical center network. There are three main hubs in Japan, Europe and in the U.S., and there are two sites in this region, one in the U.K. and the other here in Barcelona. In fact, , more than 20 years ago the Barcelona technical center founded of one of the most important test tracks in Europe which is based in Catalonia and funded by various global car manufacturers. From its inception right up to today, one of our practices has been collaborating with several small engineering companies. They use our platform to test their disruptive technologies and, in turn, we have the opportunity for discovery. This is one way Nissan, as a big OEM, can contribute to helping startups in the automotive sector.

What do you think smart city transport should look like in the future and how is Nissan going to collaborate with smart cities around the world?

The concept of a smart city for us is about how to improve city dwellers’ lives through the development of the current and new generation of vehicles, and Nissan’s mission is centered around precisely this. In this respect, as I said, our idea about the role of the vehicle of the future, is not just a means of moving from one point to another, but it is a storage system, or a battery on four wheels that is connected with other vehicles and able to drive autonomously. Our idea of the vehicle of the future is one that when you do not need it, it can earn you money by taking itself to a place in the city that needs energy, and then come back to pick you up whenever you need it.

The future is about electrification, connectivity and autonomous driving. The role of a vehicle will become a source of energy that moves around the city. In terms of how far off this reality is, again, the issue is not about the technology. The barriers today are more political, whether it be messages in the news that say that if we move to an electric world we are going to lose thousands of jobs, or the debate over recycling the batteries. Today all vehicles have a battery with heavy metals, which are much more of a pollutant than the lithium battery used in electric vehicles, and no one is arguing over that. This is why the timing is difficult to predict. It is not a technical issue, rather it is about the motivation to allow this new kind of world to emerge. At Nissan we are ready and we have the technology to step into this new reality.

In fact, in Japan we already have driverless taxis moving along Tokyo streets. They can pick you up in front of your house, and with your cell phone you decide how you want to move about the city. A second example is what we are doing with Wallabox, one of the unicorn companies based in Catalonia which is already on the NYSE. They have 12 Nissan LEAFs in their headquarters in Barcelona plugged into V2G technology to use solar panels. They have renegotiated their contract with their utilities company to decrease the electric capacity they need to run the building. They no longer need as much because they are using the solar energy stored in the LEAFs to satisfy their energy needs during the day. These are two clear examples of our current reality. The technology is there. We just need the country’s leadership to see the opportunities that this technology can bring to society.

The government simply needs to make things easier. In Spain, for example, when it comes to setting up charging stations, there are distinct administrative procedures one needs to follow depending on which state you are in. The first step is to try to make it easier for companies and for people to adopt this new technology, and this is not yet the case. If we want to move towards universal electric mobility we need the commitment of all the stakeholders to get there.