Can VinFast make EV battery subscriptions a thing?

At the New York International Auto Show on Wednesday, Vietnamese automaker VinFast revealed battery subscription prices for the two electric SUVs it aims to sell in the U.S. market by the end of the year.

The company, which recently invested $2 billion to build its first U.S. factory in North Carolina, also announced a partnership with Electrify America that will give its customers access to a fast-charging national network. VinFast has hinted at other similar partnerships to be revealed in the future.

VinFast’s battery leasing model involves selling its vehicles — the VF 8, a five-passenger midsize SUV, and the VF 9, a seven-passenger SUV — without the battery pack included in the price. Customers can instead lease the battery for a monthly fee that will be based on how many miles they drive. This model might help make its vehicles more accessible, the company contends.

It also has the potential to extend the lifecycle of the vehicle itself. Taiwanese company Gogoro, which has recently gone public via a special purpose acquisition merger, has popularized its electric motorcycle and moped battery swapping ecosystem in Taiwan in large part due to the ease factor of swapping a battery rather than waiting for it to charge. However, batteries are often the first components of a vehicle to die, so being able to simply replace it, rather than the whole car, can keep vehicles on the roads longer.

However, it’s not clear whether adding this layer into the VinFast equation will make the whole process just that much more confusing for EV buyers, especially if they’re in a region where it’s difficult to trade in a battery, although VinFast is planning to open at least 60 stores across the U.S.

The scheme is made potentially more complicated because VinFast says that by the end of 2023, 50% of the battery will be for rent while the rest is for sale along with the purchase of the car. VinFast did not respond in time to requests for clarification.

The VF 8 will cost anywhere from $40,700 to $48,000 depending on trim and battery pack, the company said on Wednesday, updating previous numbers shared at CES in January. The VF 8 Eco version battery can go up to 292 miles on a full charge and the Plus version can go up to 277 miles.

The VF 9 has a price range of $55,500 to $61,000. The Eco version of its battery has a top range of 369 miles, and the Plus version can go up to 360 miles, VinFast said.

It’s not yet clear whether the vehicle prices will be different should a customer choose to go the battery leasing route.

VinFast is offering a flexible plan of $35 per month for the VF 8 and $44 for the VF 9 for drivers who can stick to 310 miles of use each month. Going over the 310 miles will incur a charge of 11 cents and 15 cents per extra mile for the VF 8 and VF 9, respectively.

According to data from the U.S. Department of Transportation’s Federal Highway Administration, the average person drives over 1,000 miles every month.

So for the average American driver, the fixed lease plan might be a better option. For $110 per month and $160 per month for the VF 8 and VF 9, respectively, customers can have unlimited miles. VinFast is currently freezing the monthly cost of the fixed plan over the vehicle’s lifetime in order to encourage new orders, the company said.

“By separating the price of the battery from the acquisition value of the automobile, VinFast takes on all the risks related to the vehicle’s battery and ensures a reasonable price for its products, while providing customers with peace of mind about the battery’s quality during use,” the company said in a statement.

VinFast said it would provide a lifetime battery warranty that covers all maintenance and repair costs of the battery, and will replace the battery for free when charging capacity dips below 70%.

At the Auto Show, VinFast also activated its VinFirst NFT exchange on Open Sea. The automaker is using blockchain technology to record orders and confirm ownership as part of a global reservation program that began in January. When customers make a deposit for their reservation, they’ll receive an NFT on VinFast’s platform.