Photo credit: NIO

Electric carmaker NIO has launched a subscription-based battery leasing service for its customers. Under the new service, NIO customers can now purchase electric vehicles and subscribe for the usage of battery packs separately. This model enables them to pay lower upfront amounts for NIO vehicles than if they were purchasing the car and battery packs together. Under the new model, buyers of NIO’s ES8, ES6, or EC6 vehicles can get discounts of about $10,000 on the upfront purchase price but have to pay about $140 each month for the use of their battery packs.

To facilitate the battery leasing service, NIO has partnered with Chinese battery manufacturer CATL and two other firms to establish a company that’ll manage the subscriptions. The four partners in total are each coughing up nearly $30 million for 25% stakes in the newly formed company. Named the Battery Asset Company, the newly formed company will purchase and own battery assets and then lease the battery packs to NIO customers who opt for the model.