JSW MG Motor India’s BaaS program offers flexible battery rentals, reducing upfront EV costs and boosting demand with over 15,000 MG Windsor bookings in 24 hours.
New Delhi. In an exclusive Q&A session, Gaurav Gupta, Chief Growth Officer of JSW MG Motor India, sheds light on the company’s revolutionary Battery-As-A-Service (BaaS) program and its impact on the electric vehicle (EV) market. Launched for the first time in India’s four-wheeler segment, BaaS is designed to reduce the upfront cost of EV ownership by offering a flexible, pay-as-you-go model for batteries, encouraging more consumers to shift from internal combustion engine (ICE) vehicles to electric cars.
Q1. How is Battery-As-A-Service (BaaS) beneficial for consumers? Can you explain how will this model work?
For the first time in the Indian4W segment, JSW MG Motor India introduced a unique ownership program named Battery-As-A-Service that caused a disruption in the Indian 4W segment. It enables customers to reduce the upfront incremental cost of EVs. This encourages customers to consider EVs as their primary car and upgrade from their existing ICE vehicle. BaaS also helps in enhancing savings of a customer, as they pay per use, enabling them to structure the expenses accordingly.
Battery-As-A-Service helps in breaking down the initial upfront cost of the battery in easy rentals/EMIs. This benefits customers as it helps them to pay for the battery just like they pay for the fuel. It is a flexible approach that eliminates the upfront acquisition cost of the battery and customers then pay for the kilometers driven and battery usage.
Hence, they enjoy a reduction in initial purchase price and ongoing operating costs. For example, if one buys an ICE car approximately at Rs 14,00,00 and then spend additional on fuel. This translates into 12000/month for 120 litres of fuel at 100 Rs / ltr for a 1500 km drive.
However, through the Battery-As-A-Service program, customers would pay only for the electric car shell as an upfront cost. And,INR 5250 as battery monthly rent + 1500/month (INR 1/km) for EV charging, totaling to INR 6750 asbattery rental for 1500 Kms runningfor Windsor.
Q2. Now that BaaS is available across your EV portfolio, how has the response from customers been on this unique ownership program?
With the launch of the Battery-As-A-Service unique ownership program across our EV portfolio, we are receiving an overwhelming response from customers. A testament of this fervor is that the MG Windsor received more than 15,000 bookings within 24 hours of commencement of booking, making it India’s first passenger EV to receive such a response.
The unique BaaS program, which is also flexible and customizable, has certainly added to the excitement, attracting more and more customers to our showrooms. With the recently launched Windsor and various customer centric initiatives to enhance EV adoption, we are aiming to grow our NEV share over60% this year.
Q3. Is there any time limit on kms that you have implemented on the BaaS plan?
We have different plans from different finance partners to suit the needs of a variety of customers. The body shell and battery can be funded for different tenures wherein you can get body shell funding for 3 to 5 years and battery can be funded for upto 8 years or 1.5 Lac Kms.
Q4. Now that the battery is on lease, who will be the owner of it? Can the customer extend or cancel the lease as per his requirement?
The vehicle will be registered in the name of the customer. It will be a privately registered vehicle and can be driven just like a normal vehicle.
At the end of 3 years (tenure of body shell funding) customer have three options:
1. Continue paying the battery rentals till end of tenure of battery funding
2. Pre-pay the battery foreclosing amount to financier and get the complete ownership of vehicle including battery
3. Return the car and get the assured buyback (after adjusting the battery outstanding. For this customer has to purchase assured buyback plan from MG initially).
However, if the customer wants to foreclose the loan/lease, then in that case, customers can prepay the Body Shell loan amount and Battery outstanding before contract period through respective partners.
Q4. What happens if the customer is unable to pay the BaaS monthly rental, but has paid entirely for the body shell?
In case of any defaults, the financier will follow-up with customers as per the standard operating protocol for payment as they follow for normal financing.
Hence, we want to reiterate that, BaaS is a thoroughly though-through approach to create a disruption and move the EV segment forward.
Q5. Who are the financiers for the BaaS program? Why are the leading financiers not a part of this?
Currently, the financiers that have partnered with us to extend the BaaS program to customers are Bajaj Finance, Hero Fincorp, Autovert&Ecofy and VidyutTech. However, seeing the kind of response, leading financiers have also showcased interest in partnering with us. We will leave no stones unturned in exploring unique opportunities to reach out to newer sets of customers.
Q6. Do you think that lowering the upfront cost will boost EV demand in the coming months and overcome the current slowdown?
The EV segment is poised for a sustained growth on the back of new product introduction, reducing battery costs, and innovative ownership packages such as the BaaS program. In addition, the on-going festive season will surely witness a growth in the sales of EVs. We remain determined that the NEVs are the future of mobility and the current slowdown that we are witnessing is just a temporary blip.
Q7. Now that your portfolio is equally divided into ICE and EVs, what is your overall strategy going forward?
As the Indian automobile industry is transitioning to a cleaner and more sustainable future, a multi-technology approach with the existence of NEVs is essential to lay a robust foundation towards this vision. EVs remain at the forefront of this transition, and we will also see other emerging technologies here. JSW MG Motor India is a responsible OEM with innovative solutions, and we continue to remain aligned to the GOI’s mission of EVs contributing to 30% of total PV sales by 2030. To make that a reality, we remain committed to bringing in smart and sustainable mobility solutions, including a wide range of NEVs.
