Buying Peace of Mind With Smart's $80 a Month Battery Rental

By · June 26, 2013

Smart ED

Mercedes-Benz has considerably sweetened the deal with the third generation of the Smart Electric Drive. (Smart photo)

Mercedes calls it Battery Assurance Plus, and it’s an option when you buy or lease the third version of the Smart Electric Drive. If worry about whether your car’s battery pack will become an expensive boat anchor has kept you from taking the plunge into our electric future, this is the car for you.

Mercedes announced it was going to offer a battery rental option last spring, and it’s already proved wildly popular in Europe, with something like 97 percent of customers opting for the deal. Now that we have the details of the American deal, it looks pretty good here, too. Not having the battery pack included as part of the purchase price cuts the bottom line $5,100 to $20,650 before any federal rebate. Apply the full $7,500 and you get to $13,150.

Like the LEAF

Yes, there are parallels between this program and Nissan’s new deal for the LEAF. That’s a guaranteed battery replacement (with a new or remanufactured unit), beginning in early 2014 and coordinated with the car’s five-year, 60,000-mile guarantee. So Nissan already assures that its battery will have 70 percent capacity (or nine bars), but the replacement policy adds that protection past the warranty point, for as long as you remain in the program.

According to Nissan’s Erik Gottfried, the company is committed to offering “peace of mind for our continually growing community of LEAF drivers.” The program grew out of preferences expressed by LEAF owners in a global survey—they wanted a monthly payment program that guaranteed a certain battery level.

Guaranteed Power!

Renting the Smart battery costs $80 per month plus tax. And with the deal comes guaranteed battery capacity of 41.6 amp-hours, 10 years of annual maintenance on the pack, and up to 10 years of repair or replacement if needed. If you lease the car, you pay $199 a month after a $2,000 down payment, and the battery rental is included. As Automotive News reported, you can transfer the rental contract to a new owner for up to 10 years, without mileage restrictions.

Of course, most EVs come with a battery guarantee, and in the Smart’s case its four years or 50,000 miles. The advantage for rental customers is if the pack’s efficiency drops below 80 percent, it gets replaced, not merely repaired. Even better is what happens if Daimler’s joint venture with Deutsche ACCUmotive develops a better battery—renters can opt for a new contract with that pack on the same terms. Effectively, it’s a no-cost battery upgrade.

Meeting the Mandates

Thank the imperatives of California’s zero emission mandates and the looming federal 54.5 mpg fleet requirements—automakers really want you to go electric. You can benefit from what are undoubtedly money-losing deals on their side simply because they need the clean car credit.

Here's another argument for the Smart, on video:

Comments

· · 4 years ago

Battery Leasing is exciting and looks very practical however the devil is in the details. The Smart Dealer tells me the Battery Lease is both transferrable and the car owner can get out before 10 years. An first name only Mercedes Benz employee finally calls me back and states the Battery Lease is Not transferrable and the car owner is locked into the $80 a month for the 10 years; that's $9600. The Smart Dealer tells me that the car is $25,000 to buy or $19,500 for the car if I lease just the battery. This statement suggests Mercedes thinks the battery value is around $5000 which sounds reasonable.
Few people keep a car for 10 years. I had hoped I could transfer the battery lease to the next owner or simply buy what's left on the battery lease. How many payments could be left starting from $5000 OR starting at $10,000. And I can't get anything in writing. Thanks.

· · 4 years ago

@Mraymaker

I'm also suspicious when they try that "Piers Morgan" advertising technique here. What Smart's ad agency doesn't realize is PM has decreased his network's market share, because people are ultimately turned off by him... So to associate another accented 'presenter' with those ads just ultimately by now is a losing cause...The failure to be up front with the details just confirms suspicions.

· · 4 years ago

"Not having the battery pack included as part of the purchase price cuts the bottom line $5,100 to $20,650 before any federal rebate. Apply the full $7,500 and you get to $13,150."

Federal rebate incentive is for a EV with a battery and size of incentive is based on size of battery installed in the vehicle. I'm not a lawyer, but sounds like "battery leasing" is something that needs clarified by IRS (as approver of the incentive).

State rebate rules will also need to be reviewed and clarified. e.g. I believe California's $2,500 incentive requires purchase, or a lease greater than 24 months for EVs. Not sure how this applies if EV purchased, but battery is leased? Each state has different criteria for incentives, so interpretations could differ.

Since a Smart's battery can be purchased with the car, or leased separately will there be an option to purchase battery separately (i.e. a replacement battery for one purchased and beyond warranty). Can a battery lease be bought out at mid-lease like a vehicle lease?

· · 4 years ago

@mraymaker:
It seems whoever you contacted has not read their own literature:
http://www.smartusa.com/_assets/_pdf/smart_battery-assurance-plus_SEO.pdf

(pg5) you can cancel the battery lease at any time, providing you return the battery, but if you do you can't take out a new one.

No mention there of what happens if you sell the car, with or without the battery though.

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