Ghosn did not offer details of the new model but this Dongfeng-Nissan electric car concept, the Venucia Viwa, shown at Auto Shanghai in 2013, gives an indication of what it might look like. Picture: Dongfeng-Nissan

Lisbon, Portugal - The Nissan-Renault alliance aims to offer Chinese drivers a new electric car costing the equivalent of just $8000 (R107 000) within two years, chief executive Carlos Ghosn said on Tuesday as he touted an “explosion” in demand amid efforts to offset climate change.

The electric car market as a whole was stepping up a gear thanks to cheaper batteries, government incentives to consumers and better infrastructure for charging vehicles on the go, he said at the Web Summit in Lisbon.

Nissan was a groundbreaker in mass-marketing electric vehicles from 2008 with the popular Leaf - but it can’t compete on price against cheaper offerings from rival manufacturers such as BYD, Zhidou and SAIC in China, which is now the world's biggest auto market and also one of its worst polluters.

“For me, it is a no-brainer: electric cars are going to be a much bigger part of our industry in the future,” Ghosn said.

“There is an explosion of demand for the small, cheap electric cars in China. We're going to compete because we want to continue to maintain our leadership in electric cars.

“China is putting a lot of support behind electric cars; it represents one-third of the world market for electric cars and it’s going to be a big market.”

Chinese engineering

Ghosn did not offer details of the new Nissan-Renault model - it works with joint venture partner Dongfeng in China - but said the price point and timeframe were set.

“Our intention is to market a car that you can sell at $8000 without government incentives,” he said, adding it would be a localised product made with Chinese engineering. “Our objective is to be on the market within a couple of years.”

Beijing is seeking to develop its nascent electric car industry with incentives and other government support in a bid to boost the country's environmental credentials and tackle crippling air pollution.

About 247 000 “zero emissions cars” were sold in China in 2015, four times the number in 2014, according to the China Association of Automobile Manufacturers.

That leaves a lot of room of growth, automakers believe, with 24 million new cars sold in China in 2015.

Climate factor

A key driver in the growth, Ghosn believes, will be climate change. Future emission regulations will “play a very important role in the speed at which electric cars are going to develop”, he said.

“This is going to drive more electric cars in the future, but the industry is still waiting on details from the international effort.”

Key to the electric development is the evolution of battery technology. Initially, Nissan made its own batteries for want of anything suitable on the market, but Ghosn said it was now content to buy from other suppliers and concentrate on researching advanced batteries of the future.