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MG Windsor EV Battery-as-a-Service Model Explained: Financing, Cost Savings & More
In an innovative move to make electric vehicles (EVs) more accessible, MG has launched the Windsor, its third EV, with a unique Battery-as-a-Service (BaaS) program, starting at a price of Rs 9.99 lakh (ex-showroom) without including the battery's cost. This pioneering scheme is designed to reduce the initial expense of owning an EV and to cut down on operating costs over time.
There's been a mix of excitement and confusion around this new model, which necessitates a deeper look into how BaaS works and what it means for prospective EV owners.
The BaaS model operates on a finance mechanism that enables customers to buy the vehicle either outright or with a loan, while leasing the battery separately. MG has collaborated with four finance companies—Bajaj Finance Limited, Herofin Corp, VidyutTech Services Private Limited, and Ecofy and Autovert Technologies Private Limited—to offer a range of rental packages.
These packages differ in terms of minimum monthly usage, per kilometer charges, and policies on excess usage. For instance, Bajaj Finance and Herofin Corp offer rates of Rs 3.5 per km for a minimum of 1500km monthly, with Bajaj not charging extra for additional kilometers and Herofin Corp doing so.
On the other hand, Ecofy and Autovert are targeting customers with lower credit ratings at Rs 5.8 per km for the same minimum usage, while VidyutTech introduces a pay-as-you-go model at Rs 3.5 per km, eliminating the minimum usage criterion.
Understanding the Financial Aspects and Savings of BaaS
MG's approach with BaaS seeks to alleviate the financial burden on EV buyers by offering them a choice to rent the battery, which is a significant portion of the EV's cost. This initiative is expected to bring down the purchase and running costs of the Windsor, making it a competitive option against compact and midsize ICE SUVs. MG estimates that customers could save between Rs 2.8 lakh to Rs 10.17 lakh over a period of three to five years, depending on usage, which is a considerable advantage.
For the implementation of the BaaS program, MG will equip the vehicles with telematics devices to monitor usage accurately. It's essential for customers to finance both the car and the battery through one of the designated partners as cross-financing is not an option.
However, for those preferring a more traditional route, MG offers the possibility to buy the Windsor with the battery included, with its price to be revealed later. Notably, while the battery rental incurs a separate charge, MG has pledged to cover the public charging costs for the first year through its eHUB mobile application, adding further to the benefits.
Exiting the BaaS Program and Assurance Measures
In situations where a customer cannot continue paying the battery rental, there are specific stipulations in place. The vehicle may be reclaimed by the company, but the process will take into account depreciation and any outstanding rental fees before issuing a refund.
Customers also have the option to leave the BaaS scheme by settling the remaining battery value and any residual amount for the vehicle. Furthermore, MG guarantees a buyback under the MG Shield Plan, should the customer choose to return the car. For incidents of battery damage or malfunction, MG extends a lifetime warranty, with insurance covering accidental damages.
Selling the vehicle while under the BaaS agreement necessitates clearing any pending dues. This condition ensures transparency and security for both the seller and the buyer, maintaining the integrity of the program.
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