Battery as a Service (BaaS)

Battery as a Service (BaaS), also known as battery subscription or battery leasing, is a business model where buyers do not purchase the traction battery when acquiring an electric vehicle (EV), but instead pay a monthly subscription fee for battery usage rights. Based on the concept of "vehicle-battery separation", BaaS decouples the traction battery from the vehicle asset, allowing an independent battery asset management company to own and operate the battery pack while users only pay for its utilisation. Pioneered at scale in China by NIO in 2020, this model aims to lower the initial EV purchase barrier while addressing common consumer pain points such as battery degradation and technological obsolescence.

Core Business Logic

The operational framework of BaaS centres on the independent management and monetisation of battery assets. When a customer opts for a BaaS package, the battery cost is deducted directly from the vehicle's retail price (e.g., a reduction of RM70,000 for the NIO ET7, RM86,000 for the ONVO L90, and RM40,000 for the Firefly), with the price differential reimbursed to the carmaker by a dedicated battery asset company (such as Weineng). The battery asset company retains ownership of the battery, while the customer owns only the vehicle rolling chassis and body. The user pays a recurring monthly subscription, and the battery asset company assumes full responsibility for operational servicing, maintenance, and entire lifecycle management of the battery pack.

Taking NIO's BaaS as an example, owners pay a monthly battery subscription post-delivery: RM980 per month for the standard-range battery pack, RM1,680 per month for the long-range pack, with non-"Service Worry-Free" package subscribers paying an additional RM80 monthly battery warranty fee. Sub-brand ONVO offers more accessible pricing, with monthly subscriptions set at RM599 for the 60 kWh pack and RM899 for the 85 kWh pack. NIO’s third sub-brand, Firefly, features a BaaS option at RM399 per month. These subscription fees generate steady recurring cash flow for battery asset operators—Weineng, for instance, managed over 35 GWh of battery assets serving more than 500,000 users by end-2025, generating an estimated annual rental revenue of RM6,000,000,000.

On the capital front, battery asset companies fund battery procurement through diversified channels, including equity financing, asset-backed securitisation (ABS issuances), and bank credit facilities. In 2025, Weineng closed a Series C funding round of nearly RM1,000,000,000 and initiated a RM5,000,000,000 ABS issuance programme. On the consumer financing side, battery asset firms collaborate with financial institutions to offer seamless online financing facilities, further easing upfront cash flow requirements for prospective subscribers.

Core Advantages

Lowering the barrier to EV ownership is the most compelling advantage of BaaS. For instance, opting for BaaS on the NIO ES8 shaves nearly RM110,000 off the sticker price, bringing the entry price down to RM298,800. Similarly, the GAC AION UT super drops from RM89,900 to RM49,900 under the battery subscription model. This "drive first, pay later" approach enables more motorists to step into EV ownership with substantially lower initial down payments.

Mitigating battery degradation and depreciation risks serves as another major benefit. For conventional EVs with outright battery purchases, State of Health (SOH) is a critical factor governing residual value in the used car market, where prospective buyers often lowball offers over battery wear concerns. Under the BaaS structure, the battery is excluded from the vehicle asset, shielding owners from battery-aging depreciation and bolstering vehicle value retention. Furthermore, the battery asset operator centrally manages the battery pool, conducting automated health checks during every battery swap and phasing out degraded packs promptly, ensuring users never have to worry about receiving a worn-out unit.

Seamless access to battery technology upgrades represents a standout value proposition. Early NIO ES8 owners can still swap in the latest 150 kWh ultra-long-range pack at swapping stations today, whereas contemporary EVs with fixed packs are permanently locked out of battery upgrades. Drivers can also flexibly tailor battery capacity to their immediate needs—running a smaller battery for daily urban commuting to trim monthly rentals, and temporarily upgrading to a larger pack for long-distance road trips to eliminate range anxiety.

Applicable Scenarios and Buying Advice

The BaaS scheme is not a one-size-fits-all solution; buyers should evaluate their options based on intended ownership duration and driving patterns.

Short-term ownership (3 to 6 years) makes BaaS exceptionally compelling. The upfront capital outlay is vastly reduced, and owners are insulated from battery depreciation when selling the vehicle, delivering a more competitive overall cost of ownership. Industry data indicates that of NIO's 326,000 deliveries in 2025, over 80% of buyers opted for BaaS, underlining solid market endorsement of the short-term ownership strategy.

Long-term ownership (over 5 years) warrants careful financial calculation. Based on an annual subscription cost of roughly RM11,800, cumulative rental expenses reach RM59,000 over 5 years and RM118,000 over a 10-year span. Some owners have pointed out that cumulative long-term subscription fees can eventually surpass the initial outright battery purchase price. Additionally, BaaS vehicles carry an inherent "ongoing subscription liability" in the second-hand market—used car dealers tend to mark down trade-in offers as incoming buyers must take over the monthly payments, with some owners noting resale values falling over RM40,000 below identical models with outright battery ownership.

It is also vital to distinguish that BaaS is not synonymous with charging or battery swapping services. The monthly battery subscription solely covers the lease of the battery hardware; users must still pay separately for electricity consumption and swap service fees whenever they charge or swap batteries, as these are billed independently.

Battery Asset Management

Battery asset management companies form the backbone of the BaaS ecosystem. Established in 2020, Weineng's founding consortium includes NIO, CATL, Hubei Science & Technology Investment, and Guotai Junan International. The company oversees full lifecycle asset management, spanning battery operations, safety monitoring, asset valuation, second-life repurposing, and end-of-life recycling.

Via its proprietary "Li-Jie" cloud data platform, Weineng performs centralised fleet-level monitoring of critical telemetry in real time, including State of Health (SOH), operating temperatures, and cell voltages, leveraging big data predictive analytics to pre-empt technical risks. This centralised, data-driven approach boosts the commercial viability and yield of second-life repurposing and recycling—retired packs yield significantly higher material recovery rates thanks to unbroken operational data logs. As Weineng's president once noted, these batteries should not be viewed as "consumables", but rather as "mobile urban mines".

Looking at broader industry dynamics, BaaS is expanding beyond NIO into multi-brand adoption. In 2025, Weineng inked BaaS strategic partnerships with automakers including JAC and Geely Commercial Vehicles. In the commercial vehicle sector, FAW Jiefang partnered with CATL and TELD to launch the "Jing E-Zu" brand, focusing on an integrated complete-vehicle and battery leasing model, aiming to build an asset platform managing 100,000 commercial new energy vehicles with total assets exceeding RM30,000,000,000 within 3 to 5 years.