BAAS On Tata Electric Cars? Chief Commercial Officer Reveals Plans
BAAS, or Battery as a Subscription, is a model for buying electric cars where the battery is rented by the buyer. This reduces the upfront costs of the EV and has helped MG in making its newly launched Windsor EV a hit in the country. Recently, it was reported that Tata Motors is also thinking of offering Battery as a Subscription service. However, a Tata Motors chief commercial officer has shared the company’s plans on this subject.
Will Tata Motors be offering BAAS?
During an interview with a media outlet, Tata Motors’ chief commercial officer, Vivek Srivatsa, highlighted that the Battery as a Subscription model has both pros and cons. Srivatsa stated that BAAS improves the affordability of electric cars and helps in attracting more buyers to consider EVs. He added that it also helps in generating interest by reducing the upfront cost of EVs.
However, he added, “It is a financial product that we had considered a few years ago, but we believed its implementation might not be easy for customers. It’s like putting a low price in an ad, but when you visit the showroom, the product is either unavailable or has a long waiting period.”
Srivatsa, while explaining Tata Motors’ stance on BAAS, highlighted that there are no immediate plans to introduce a Battery as a Subscription model. However, the company has not closed the doors on this service. He added that Tata Motors is open to adopting it in the future if the market conditions support Battery as a Subscription.
Additionally, Srivatsa also mentioned that Battery as a Subscription is not a huge technological shift; rather, it is more of a financial product. He added that the real challenge when it comes to BAAS is ensuring that there are actual conversions from the consideration point to ownership.
Prior to this, another Tata Motors representative had mentioned, “We had tested the BAAS option about three to four years back and found that it was confusing customers. While physically the battery and the vehicle are not separated, financially the pricing model was separating them. It was not easy for customers to understand this, and so we decided not to proceed with it then.”
What is BAAS?
For those who may not be aware, Battery as a Subscription is a model in which EV buyers, instead of paying upfront for the car and the battery together, can only pay for the car and get the battery on rent. In this way, the owner only has to pay for the usage of the battery on a per-km basis. MG, with its BAAS, also offers a buyback, which ensures that the owners do not have to bear the burden of battery replacement.
Indian Car Buyers’ Issue with BAAS
Now, although BAAS seems like a very good idea on paper, it has to be considered that Indian buyers have a very different way of thinking. Many people do not prefer the concept of renting, as they believe in full ownership of the vehicle. Srivatsa, during his interview, highlighted that subscription and renting models may work in the long term; however, currently, they are not very attractive due to cost and emotional factors.
Tata Motors Betting Big on EVs
Even though Tata Motors may not be offering BAAS in the near future, the company is still extremely bullish on the future of EVs in India. It will be introducing the Harrier.ev, Safari.ev, and Sierra.ev in India this year. All of these SUVs will be based on Tata’s new Acti.ev architecture, which will offer a 75-80 kWh battery pack, providing a range of more than 500 km on a single full charge.