December 14, 2010 – The Nissan Leaf Roll Out

Featured Trades: (NISSAN LEAF), (NSANY)


2) The Nissan Leaf Roll Out. With great fanfare and celebration, Nissan Motors (NSANY) at long last delivered its first all electric, 100 mile range Leaf to an ecstatic customer at San Francisco city hall today. Long time readers of this letter know that I have been banging the table on this technology for some time, starting with my now ancient recommendation to buy Sociedad Quimica Y Minera (SQM), Chile’s largest producer of lithium (click here for the piece).

Offering a car which effectively uses no fuel, requires no maintenance, at a heavily government subsidized price could only be a blow out success. One of the most aggressive and ambitious adverting campaigns in history assured that even Neolithic consumers living in caves in Borneo would know about it. Nissan is confidently betting the company that the project will be a blow out success, ramping global production up to 500,000 annually by the end of next year. My local utility, PG&E, (PGE) has since upped the ante by cutting prices for electric vehicle recharges between 12:00 midnight at 7:00 am from their peak rate of 40 cents per kilowatt hour to only 3 cents, a 92.5% discount. That works out to buying all the gasoline equivalent I want at 14 cents a gallon.

I predicted that these developments would conspire to drive the shares of Nissan Motors ever Northward. Nissan has been in my model portfolio for a while as a play on the recovery of the global auto industry. Those who piled into my initial recommendation to buy the stock last July are now up a handy 30% (click here for the ‘Making a New Home for My Nissan Leaf’).

For those of us who have been involved in the alternative energy space, this has been a very long time in coming, some 40 years in my case. Since I am neither a movie star nor a lucky lottery winner, I will not get delivery of my own Leaf until March, 2011. But the dealer has already called, asking which options I wanted. Fully loaded with all the bells and whistles, even with the $1,200 solar cell roof that looks cool more than it is functional, it will cost me $38,000. When I do get what will undoubtedly be the most enviable wheels on the block, you’ll be the first to hear about it. Buy a new two year subscription to my letter, and I might even give you a ride.

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