NEW DELHI: Is battery rental model, which allows customers easier affordability by paying only for a car, with battery costs being paid as monthly EMIs, working for electric cars?
JSW MG’s Windsor, the first electric car to come with ‘battery as a service’ (BAAS) model, was the largest selling green car last month, pipping much-established and fancied models such as Tata Nexon, Tata Curvv, Mahindra XUV4OO as well as its own ZS SUV.
As per numbers provided by industry analysts, the Windsor sold 3,116 units in Oct, against 1,593 units of Nexon, 1,542 units of the Curvv, 1,017 units of Tiago and Tigor, 915 units of Punch, and 602 units of the XUV4OO (all electric versions). While sale in a single month may not be a fully accurate barometer of measuring a model’s success, the lead based on an innovative scheme does point towards a trend where customer comfort can be seen.
The battery rental model, a novel concept introduced by JSW MG at Windsor’s launch in Sept this year, allows customers to pay for the vehicle, but minus the battery cost, which is a substantial part in the cost of an electric. This means that a customer is not burdened with a hefty price tag right at the time of purchase of an electric vehicle and can pay for it over a period of time through easy EMIs (MG fixed Rs 3.5 per km running as monthly instalment for the battery).
The only drawback here is that against paying a GST rate of 5% that has been fixed for EVs, the monthly EMI on battery usage will mean that GST will be higher, where it is seen as a service. With the battery rental model, JSW MG also gave out other benefits such as a ‘lifetime battery warranty’ to the first owner, and one-year free charging at public stations. MG also gave an assured 60% buyback value for the car after three years or 45,000 km of run in another comforting factor for customers, who may still have doubts about buying an electric car.
Parth Jindal, director at JSW MG Motor India, said the battery rental model helped the company “create disruption” in EV market. “This vehicle embodies our commitment to delivering innovative, futuristic and sustainable mobility solutions… Windsor is driving democratisation of electric mobility.”
Satinder Singh Bajwa, chief commercial officer for JSW MG, said that not only the metros, but the offer was also received good response in smaller towns and cities. “Nearly 50% of Windsor’s sales came from smaller cities, including Tier II and III locations, showing a growing acceptance of electrics beyond major urban centers.”