Franklin, Tennessee – Nissan North America has been conditionally approved for a US$1.6 billion loan from the Department of Energy to modify its Smyrna, Tennessee plant to produce electric vehicles (EVs) and lithium ion battery packs.

The loan, announced by the Department of Energy, is among the first three under the Advanced Technology Vehicles Manufacturing Loan Program (ATVMLP), a $25 billion program authorized by Congress.

The ATVMLP is designed to accelerate the development of vehicles and technologies that increase U.S. energy independence, create cleaner means of transportation, and stimulate the American economy. Companies receiving the loans go through a financial and technical qualification process, and must put collateral in place before approval.

Construction at Smyrna is scheduled to begin by the end of 2009, after an environmental assessment is completed. Vehicle production is planned to start in late 2012. Modifications include a new battery plant and changes in the existing structure for EV assembly. When fully operational, the plant will have the capacity to build 150,000 vehicles and 200,000 batteries per year.

Nissan said its EVs will comfortably seat five people, drive on any American road or highway, and have an initial range of 100 miles (160 km) before recharging.

Connect with