China’s top electric-car battery producer, Nio to team up for battery-swap venture as industry sales forecast to triple by 2025
- Contemporary Amperex, Nio and two others to form a battery-swap venture to help lower initial cost of EV ownership
- New venture to charge subscribers 980 yuan a month for convenience and peace of mind, in case battery goes flat on long-distance driving
Contemporary Amperex Technology Ltd (CATL), which owns the biggest EV battery production capacity, will form a venture called Wuhan Weineng Battery Asset with an initial capital of 800 million yuan (US$115.4 million) to lease battery packs to car owners.
It will take an equal stake in the business with US-listed EV maker Nio, financial services group Guotai Junan International and Hubei Science Technology Investment Group, according to a company statement.
The venture underscores optimism in the market as the industry forecast a tripling in sales of NEVs by 2025 despite a recent sales hiccup caused by the coronavirus pandemic. Chinese policymakers have also dangled incentives to spur sales and help shore up a rebound in domestic consumption.
“The new battery-swap company will benefit drivers as it lowers the prices for car purchases and eases driving range anxiety,” CATL said in a statement. “The BaaS (battery as a service) model will accelerate the electrification drive in the automotive industry.”
The model allows customers to buy an electric car while subscribing to a separate battery-leasing plan for a fee. This can help lower the upfront cost of owning an electric car by about 20 per cent, it said.
