Nissan Leaf electric car to cost £28,350 – £10,000 more than rivals

The world's first mass-market electric car, the Nissan Leaf, will cost nearly £10,000 more than its equivalent petrol and diesel rivals.

Nissan, which announced the European pricing for the fully electric Leaf today, said that the five-door car would set consumers back £28,350, dropping to £23,350 when a UK government grant is included.

The Leaf hopes to change the eccentric image of electric cars, which have been dogged by safety fears and a lack of recharging points. Similar-sized conventional cars such as the Ford Focus cost just under £19,000, and the Leaf's obvious direct rival, the Prius electric-petrol hybrid, costs £19,500-22,500.

Initially, the AA said that the Leaf would cost about 0.3p per mile, depending on the user's electricity tariff, while a Ford Focus or similar car in that category would cost about 14p a mile. "If you do 10,000 miles you save around £1,500 a year. Over three years you almost make your money back on the premium," Edmund King, the AA's president, was quoted as saying.

[However, about a month later, in mid-June, the AA confirmed that the cost would be more like 2p per mile; the 0.3p rate was derived from a very low night electricity rate, it explained. This means the initial AA calculation - that a driver doing 10,000 miles could save around £1,500 a year, so almost compensate for the higher capital cost in three years - no longer holds true. The car is, though, exempt from vehicle excise duty and London's congestion charge. See footnote.]

With a range of 100 miles, the Leaf will be able to go without the plug socket for more than double what first generations of the iconic G-Wiz electric car managed and should avoid drivers being worried they will become stranded after running out of power.

"This is the first proper electric car on the market, and 100 miles is the minimum that serious drivers will be looking for," said King.

The first 50,000 cars, which go on sale in the UK in February next year, will be made in Japan, but when a Nissan factory in Sunderland opens in 2013 it will be one of the first major electric cars made in the UK. Nissan said even with today's relatively dirty energy mix it represents a 60% improvement in CO2 emissions against conventional petrol and diesel cars.

But there could be bumps on the road ahead, with a question mark hanging over the last government's plans to pay car buyers up to £5,000 towards the asking price of a new electric car from 2011. A Department for Transport spokesperson said they couldn't confirm if the grant would be retained until the government publishes its 'final coalition agreement'.

A commitment to the grant was conspicuously lacking from the otherwise relatively detailed environment section of the coalition agreement published last week, which talks of "mandating" a network of electric recharging points. There are currently only a few hundred such points in the UK, mostly in London.

Nissan projects that by 2020 one in ten new cars will be electric. But it is not yet clear how strong consumer demand will be. An Auto Trader online survey earlier this year suggested that, while nearly two-thirds of people have environmental impact in mind when buying a new car, only 8% ranked it as a key factor, making it the least important, below five other factors such as reliability and aesthetics.

Ben Lane, editor of What Green Car, said Nissan would likely be losing money on the first sales of the Leaf but said, "It could do for electric cars what the Toyota Prius did for hybrids." Toyota has sold over 1m units of the Prius since it launched in 1999.