Nissan wants to ramp up its electrification effort, but it doesn’t want to make its own batteries anymore.

It had a lot of difficulties getting rid of its battery manufacturing subsidiary, but they have now finally found a buyer.

For over two years now, the Japanese automaker has been rumored to be looking for a buyer to take over Automotive Energy Supply Corporation (AESC), which manufactures battery cells for Nissan’s electric vehicles.

Last year, it was in talks with Panasonic, but that didn’t work out.

Nissan later confirmed that they came to an agreement with GSR Capital, a private investment fund based in China.

The deal fell through just last month as GSR Capital reportedly couldn’t get the money together – an estimated $1 billion.

Now Nissan says that it found a new buyer: Envision Group (Envision), a sustainable energy operator.

Envision will acquire AESC and Nissan’s battery manufacturing operations in Smyrna, Tennessee, owned by Nissan North America Inc. (NNA), and in Sunderland, England, owned by Nissan Motor Manufacturing (UK) Ltd. (NMUK), as well as its Japanese battery development and production engineering operations located in Oppama, Atsugi and Zama.

Lei Zhang, founder and CEO of Envision, said about the announcement:

“We are excited to announce the acquisition of Nissan’s battery business, a leading producer of advanced, safe and reliable lithium-ion batteries. Together with the battery business management team and its highly skilled workforce, this partnership will see Envision expand both organizations’ footprints into the intelligent energy ecosystem to create new innovative solutions for the IoT value chain. With this strategic acquisition and collaboration, we aim to expand our activities via investment into the new company to realize the value of IoT technology for smart transportation, V2G, and smart city solutions.”

They intend to keep the existing workforce and continue operation.

Despite the sale, Yasuhiro Yamauchi, Nissan’s Chief Competitive Officer, said that they are still committed to electric vehicles:

“We are pleased to have secured a definitive agreement with Envision, a leading global company in the field of sustainable energy. The transaction will enable Nissan to concentrate on developing and producing market-leading electric vehicles – in line with the goals set in our midterm plan Nissan M.O.V.E. to 2022. We are confident that Envision will be a strong, long-term owner of the new company and that it will further grow as a battery company with increased competitiveness.”

The move comes as Nissan’s next version of the Leaf is going to use LG Chem batteries instead of its own AESC battery cells in the current Leaf.

At some point in 2014, AESC, which is also partly owned by NEC, became one of the largest electric vehicle battery manufacturers, second only to Panasonic, Tesla’s battery cell supplier. The joint-venture has since lost market share and Nissan has been quite open about looking to partner with someone else for future EV programs.

Information that leaked from a Nissan presentation earlier this year showed that the Japanese automaker is preparing a powertrain update for the 2019 version that would include a new 60 kWh battery pack with LG Chem cells.

Electrek’s Take

Aside from Tesla, most automakers are shying away from getting too involved in battery cell production and this is a great example. Nissan was a pioneer in it and now it is walking back on it entirely.

We just reported yesterday about VW considering its own battery cell production for electric vehicles in 2025 after already having issued $48 billion in battery cell contracts.

One thing is clear: securing battery cell supply is going to be (and arguably already is) crucial for automakers to survive.

It looks like many are still experimenting with different ways to do that.

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