The battery leasing service market is valued at USD 189.63 million in 2025. As per FMI's analysis, the market will grow at a CAGR of 17.4% and reach USD 943.17 million by 2035. FMI analysis found that in 2024, the industry grew steadily due to the rising adoption of electric vehicles (EVs) and a shift toward sustainable energy. Government incentives for EVs, expanding battery-swapping infrastructure, and automaker-leasing firm partnerships played key roles in driving industry expansion during the year.
Countries with strict carbon reduction goals accelerated battery leasing adoption, particularly in urban areas lacking charging infrastructure. Lithium-ion battery leasing gained traction, especially among fleet operators and logistics firms aiming to cut operational costs. Flexible lease terms and the advancement of technology further stimulated consumers' interest in this service.
FMI believes policies favoring second-life use and battery recycling increased the viability of leasing models. Reduced initial expenses and AI-driven battery management systems will propel demand for leasing in 2025. Car manufacturers will likely increase leasing as part of their EV strategy to capture more customers.
FMI research revealed that the Asia-Pacific region will drive worldwide growth in battery leasing, with Europe coming second, while North America will grow as infrastructure developments gain momentum. The industry is on the cusp of explosive growth, with new business models coming up to make EV use more affordable and convenient for people across the world.
Key Metrics
| Metric | Value |
|---|---|
| Estimated Global Size in 2025 | USD 189.63 Million |
| Projected Global Size in 2035 | USD 943.17 Million |
| CAGR (2025 to 2035) | 17.4% |
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(Survey Conducted in Q4 2024, n=500 stakeholder participants evenly distributed across battery manufacturers, automakers, leasing firms, policymakers, and energy providers in the USA, UK, France, Germany, Italy, South Korea, Japan, China, and Australia-NZ)
Fleet Electrification and Cost Reduction: 79% of stakeholders identified fleet electrification as a top priority, with battery leasing viewed as a cost-effective strategy for accelerating EV adoption.
Battery Longevity and Performance: 71% emphasized the need for longer battery life and predictable degradation rates to ensure profitability in leasing models.
Regional Variance:
Technology Adoption Trends:
Convergent and Divergent ROI Perspectives:
USA & EU: 69% of firms determined that integrating smart monitoring significantly enhances lease profitability.
Japan & South Korea: Only 41% saw an immediate financial advantage, citing concerns over high initial investment costs.
Regional Differences:
Common Challenges:
Regional Preferences:
Battery Manufacturers:
Leasing Companies:
End-Users (Fleet Operators & Consumers):
Alignment: 72% of global stakeholders plan to invest in battery circularity and second-life applications.
Regional Divergence:
High Consensus:
Cost-effectiveness, battery performance optimization, and infrastructure expansion are universal concerns.
Key Regional Variances:
The battery leasing service market is on a rapid growth trajectory, driven by the rising adoption of electric vehicles and the need for cost-effective, sustainable energy solutions. Automakers, fleet operators, and urban mobility providers stand to benefit from lower upfront costs and enhanced operational efficiency, while traditional fuel-dependent industries may face increasing displacement. FMI analysis found that government incentives, advancements in battery technology, and expanding leasing infrastructure will accelerate this shift, solidifying leasing as a mainstream model for energy storage and mobility.
Expand Battery Swapping and Leasing Networks
Invest in infrastructure for battery swapping stations and flexible leasing models to enhance accessibility and convenience for electric vehicle users. Partnerships with automakers and urban transit authorities will accelerate adoption and improve customer retention.
Integrate AI and Smart Battery Management
Leverage AI-driven battery monitoring and predictive maintenance to optimize performance and extend battery lifespan. Aligning with advancements in energy storage and sustainable technology will ensure competitiveness as regulatory and consumer expectations evolve.
Strengthen Supply Chain and Recycling Initiatives
To ensure long-term sustainability, secure raw material supply chains and invest in battery recycling programs. Strategic mergers and acquisitions with battery manufacturers and recycling firms will create cost efficiencies and strengthen industry positioning.
| Risk | Probability & Impact |
|---|---|
| Battery Supply Chain Disruptions-The industry's dependence on critical minerals like lithium, cobalt, and nickel makes it vulnerable to geopolitical tensions, trade restrictions, and mining limitations. Supply shortages or cost spikes could delay production and increase leasing costs, requiring firms to diversify sourcing and invest in localized manufacturing. | High Probability, Severe Impact |
| Regulatory and Policy Uncertainty- Changes in EV subsidies, taxation, and environmental regulations can impact leasing feasibility and profitability. Inconsistent policies across regions create uncertainty, necessitating proactive engagement with policymakers and flexible business strategies to adapt to evolving compliance requirements. | Moderate Probability, Significant Impact |
| Consumer Adoption and Cost Sensitivity-While battery leasing reduces upfront costs, consumer hesitation over long-term leasing fees and the resale value of EVs may slow adoption. Clear pricing structures, enhanced leasing benefits, and customer education will be crucial in overcoming cost-related concerns and driving industry penetration. | Moderate Probability, High Impact |
| Priority | Immediate Action |
|---|---|
| Battery Supply Chain Resilience | Run feasibility studies on nickel-based insert sourcing to reduce dependence on lithium and cobalt and ensure long-term supply stability. Conducted supplier assessments, negotiated long-term contracts, and explored alternative battery chemistries to mitigate risks associated with raw material shortages and price fluctuations. |
| EV Leasing Model Optimization | Initiate an OEM feedback loop on hybrid insert demand to refine leasing structures based on automaker and consumer preferences. Engage with vehicle manufacturers to assess demand for hybrid battery solutions, optimize pricing models, and ensure alignment with future vehicle designs and energy efficiency regulations. |
| Aftermarket Expansion Strategy | Launch an aftermarket channel partner incentive pilot to strengthen leasing penetration beyond direct sales. Develop incentive programs for dealerships and third-party distributors to ensure wider access to leased batteries. Monitor performance metrics and adjust pricing or contract terms to improve adoption rates. |
To stay ahead, companies must expand battery leasing services by prioritizing supply chain diversification, accelerating OEM collaborations, and growing aftermarket partnerships. Securing alternative raw material sources will mitigate volatility while refining leasing models based on automaker feedback will drive adoption. Expanding distribution through incentive-backed channel partnerships will enhance industry reach.
This intelligence reshapes the roadmap by emphasizing proactive supply strategies, adaptive leasing structures, and aggressive network expansion-ensuring sustained growth and competitive differentiation in an evolving energy landscape.
| Country | Regulatory Impact & Mandatory Certifications |
|---|---|
| United States | Federal EV tax credits and Inflation Reduction Act (IRA) incentives are driving battery leasing adoption. The National Highway Traffic Safety Administration (NHTSA) and Environmental Protection Agency (EPA) set safety and emission standards for EV batteries. Companies must comply with UL 2580 (battery safety) and UN 38.3 (transport and shipping). |
| United Kingdom | The UK's Zero Emission Vehicle (ZEV) mandate requires increasing EV adoption, boosting demand for battery leasing. The Battery Regulations 2023 align with EU standards, requiring producers to meet recyclability thresholds and obtain UKCA markings. |
| France | The French government provides leasing subsidies under the "Social Leasing" program, promoting affordable EV battery leasing. Batteries must comply with EU Battery Regulation 2023/1542 and obtain CE marking to ensure the safety, recyclability, and ethical sourcing of raw materials. |
| Germany | Strict environmental and circular economy policies under the German Battery Act (BattG) mandate battery take-back and recycling responsibilities for leasing firms. Compliance with the European Battery Passport, effective 2027, is crucial for transparency in battery lifecycle tracking. |
| Italy | Italy offers tax incentives for leased EVs under the Ecobonus program. Companies must comply with EU Battery Directive standards for durability, performance, and sustainability. New extended producer responsibility (EPR) rules are under consideration to regulate battery disposal. |
| South Korea | The South Korean government supports battery leasing under its EV subsidy program, but strict safety regulations require compliance with Korean Industrial Standards (KS C IEC 62660) for battery performance and reliability. Companies must also meet the Korean REACH framework for hazardous materials. |
| Japan | Japan’s Green Growth Strategy promotes battery leasing with tax incentives, but companies must meet JIS (Japanese Industrial Standards) for battery safety and disposal. The Act on Recycling of Specified Kinds of Home Appliances covers battery reuse and recycling mandates. |
| China | China leads in battery leasing due to strong policy support under the NEV (New Energy Vehicle) framework. The government enforces GB/T standards for battery safety and requires compliance with China’s Battery Recycling Policy, which mandates second-life use and responsible disposal. |
| Australia-NZ | Australia lacks a national battery leasing policy but follows international safety standards like IEC 62660 for EV batteries. New Zealand promotes EV leasing under its Clean Car Discount program, encouraging battery take-back initiatives to minimize environmental impact. |
The subscription service segment will be able to continue its domination in the industry and will have a CAGR of 18.2% from 2025 to 2035. Powering a significant part of the EV revolution, with a whopping 70% share in 2022, this model continues to be the preference due to cheaper, quick, and battery-swappable convenience. Its growth is supported by the increasing uptake of EVs across fleet operations and shared mobility services.
Government-supported plug-in battery leasing incentives also grow the overall pie. Giant companies are utilizing energy smart management and steps predictive analytics to optimize the function of their battery. Long-cycle lease options and second-life applications to enhance battery life are also restoring consumer confidence in this model as a long-term solution to cheap EV uptake.
Lithium-ion (Li-ion) batteries remain the dominant actor with a projected compound annual growth rate (CAGR) of 17.9%, between 2025 and 2035. Li-ion account for 72% of the share in 2022 and remains the preferred choice because it has high energy density, longer life, and efficiency. However, higher raw material costs as well as supply chain disruptions could also affect affordable leasing.
These cost challenges are being dealt with by companies investing in battery recycling and second-life applications. And advances on both far in battery chemistry and battery manufacturing technology have been added, intensifying the situation. Thanks to a combination of factors, including expanding interest in EVs worldwide - with Li-ion chemistry powering practically every plug-in vehicle - and pressures caused by rising costs.
Passenger vehicles will remain the leading segment, growing at a CAGR of 17.8% from 2025 to 2035. With a 61% share in 2022, this segment benefits from increasing consumer EV adoption, affordability challenges, and battery-as-a-service (BaaS) solutions. Leasing also lowers upfront costs of EVs, attractive to consumers.
Urban mobility trends, government subsidies as well as growing charging infrastructure are also boosting demand. Automakers and leasing firms are introducing flexible lease plans to encourage adoption. While infrastructure gaps persist in some regions, ongoing investments in battery-swapping networks will support sustained growth in the passenger vehicle segment.
The USA is estimated to grow at a CAGR of 18.1% from 2025 to 2035, significantly faster than the global average, due to important stimulus and high EV adoption rate. Significant demand due to tax credits for EV purchases has been generated under the Inflation Reduction Act (IRA). This incentivized leasing companies to offer economical alternatives to consumer industries. The coordination of battery-as-a-service by major OEMs like GM and Tesla has further fueled the increase in acceptance.
To provide convenience, there are businesses that have begun setting up battery-swapping stations in urban locations due to the reassurance of an elaborate charging infrastructure in the USA So fleet operators are increasingly transitioning to battery leasing - especially for logistics and ridesharing services -- as an approach for reducing costs and downtime on the road.
Nonetheless, there are several other obstacles. Among these are regulatory fragmentation from state to state and issues about the battery disposal regulations. The introduction of battery passport compliance by 2027 will impose further compliance costs on leasing companies, actually mandating increasing battery lifecycle tracking. Notwithstanding those challenges, growing consumer demand, government incentives, and the development of battery management technology will create enough momentum for the USA to become a prominent force in the global battery leasing industry.
The UK is expected to grow at a CAGR of 17.2% from 2025 to 2035, driven by the Zero Emission Vehicle (ZEV) mandate and strong government support for fleet electrification. The UK government’s "Social Leasing" program aims to make EVs affordable for low-income consumers, pushing leasing adoption.
Fleet operators are leading the shift, with logistics and ride-sharing companies opting for battery leasing to mitigate high upfront costs and ensure predictable operating expenses. Battery recycling and second-life applications are gaining traction due to stringent regulations under the UK Battery Regulations 2023. Automakers like Nissan and Jaguar Land Rover are forming partnerships with leasing firms to provide integrated battery solutions.
The UK’s expanding charging infrastructure, coupled with growing investment in battery-swapping stations, is enhancing the feasibility of battery leasing services. However, cost barriers remain a challenge, as high energy prices and regulatory uncertainties around post-Brexit trade policies may impact investment. Despite these hurdles, the UK is poised to remain a strong player in the European battery leasing industry, benefiting from sustainability-focused policies and increasing EV penetration.
France is projected to expand at a CAGR of 16.9% from 2025 to 2035, supported by favorable government policies and rising consumer adoption of electric vehicles. Under the Ecobonus program, the French government allows financial incentives for leased EVs, making battery leasing really cost-effective. The "Social Leasing" program has made things easier for low-income consumers to access affordable solutions.
Automakers such as Renault and Peugeot have included battery leasing into their EV sales models, especially for urban mobility solutions. Adoption is further being driven today by the emergence of battery-swapping networks founded by French startups and energy companies. This is complemented by France's enforcement of stricter recycling laws on the backdrop of the EU Battery Regulation 2023/1542, requiring leasing companies to manage their end-of-life batteries properly in an environmentally sustainable manner.
These challenges include regulatory uncertainties surrounding battery ownership and the uncertain future pricing structure. Nevertheless, as the country strengthens its credentials as a sustainable mobility leader, demand for battery leasing services may grow, especially in commercial and urban transport sectors.
Germany will grow at CAGR 17.0% from 2025 to 2035, with the propellants for this being ambitious decarbonization goals and strong EV adoption rates. Germany has the largest electric vehicle industry in Europe, while demand for cost-effective battery solutions is propelled by government subsidies and stringent emission regulations.
The introduction of the German Battery Act (BattG) as well as the European Battery Passport regulation is creating a framework for the leasing industry, whereby companies are required to ensure stringent adherence to recycling and tracking. Automakers such as Volkswagen and BMW are utilizing battery leasing to improve affordability and maximize the battery lifecycle.
Germany's well-developed charging infrastructure and increasing investments in battery-swapping stations are strengthening the case for leasing services. Fleet operators, particularly in urban logistics, are rapidly transitioning to leased battery models to lower the total cost of ownership (TCO).
Italy is projected to grow at a CAGR of 16.4% from 2025 to 2035. The Ecobonus program has leveraged attractive leasing opportunities for financially restrained customers in adopting EVs. Several automobile manufacturers, like Fiat, now integrate leasing models into their sales strategies so as to gather more shares in the industry. The leasing arrangements have also been embraced in logistics and public transport for cost-cutting purposes and improvement in fleet efficiency.
Government incentives are eenorments that foster leasing acceptance particularly amongst small and medium enterprises seeking to electrify their fleets. However, the electric vehicle infrastructure in Italy is at best patchy, with northern regions such as Lombardy and Emilia-Romagna registering higher adoption levels than the southern regions, where access to charging points remains limited. The regional disparity does affect industry growth, especially among private consumers that require more infrastructure in place before any potential switch.
Nevertheless, the leasing companies are being creative: flexible contracts allow for easier uptake of EVs. The extension of battery usefulness beyond the first lifecycle, thanks to the development of second-life battery applications encouraged through government incentives, promotes leasing even further. Increased interest in leasing options abound, but continued investment in charging infrastructure and regulatory alignment throughout the regions will remain critical to the industry price growth going forward.
South Korea is projected to develop at a CAGR of 17.5% between 2025 and 2035. Solid government EV subsidies and growing battery-swapping stations are driving leasing adoption, especially among fleet operators and logistics players seeking to lower initial capital outlays. Hyundai and Kia are integrating leasing into their EV sales models, rendering electric vehicles more affordable.
South Korea's robust battery manufacturing infrastructure, driven by LG Energy Solution and SK Innovation, positions the nation advantageously. Still, stringent regulation in accordance with Korean Industrial Standards (KS C IEC 62660) and battery recycling requirements under the Korean REACH regime complicate leasing activities. While large businesses can manage to overcome these complexities, smaller enterprises find it challenging to meet the costs of compliance.
In spite of these regulatory challenges, growing corporate sustainability efforts and government-supported programs encouraging leasing are repeatedly prompting demand. Moreover, investment in intelligent battery management and second-life uses is also generating new leasing prospects. As South Korea advances its EV infrastructure, leasing will play an essential role in making EV ownership more flexible, cost-effective, and scalable for businesses and consumers.
Japan is expected to grow at a CAGR of 16.0% from 2025 to 2035. Government incentives, tax reductions, and the Green Growth Strategy are encouraging adoption, but long-standing cultural preferences for vehicle ownership present a challenge to leasing expansion. While Toyota and Nissan are exploring battery-swapping solutions, high infrastructure costs continue to slow adoption.
Leasing is also gaining popularity in cities where confined space makes swapping batteries more convenient than charging at home. Small EV battery solutions for city dwellers and light commercial vehicles are increasingly applicable. Slow infrastructure growth beyond large urban centers, however, inhibit large-scale adoption.
Moreover, regulatory hurdles regarding battery recycling and disposal continue to pose a challenge. Leasing companies have to adhere to stringent recycling requirements and safety standards, raising costs for providers as well as customers. Investing in smart battery management, second-life uses, and combined EV-sharing models is projected to enable industry growth despite these challenges. The shift towards corporate and commercial fleet electrification is also likely to drive demand for leasing solutions in the coming years.
China is projected to grow at a CAGR of 18.5% from 2025 to 2035, making it the fastest-growing industry. The nation's aggressive promotion of new energy vehicles (NEVs) and government-supported battery-swapping programs have rendered leasing a more desirable option for both businesses and consumers.
Large automakers like NIO and BYD have led the way with battery-as-a-service (BaaS) models, enabling customers to lease batteries independently of EVs and lowering initial costs. Fleet operators and ride-hailing services, such as Didi Chuxing, are also adopting battery leasing to lower operating costs and maximize vehicle uptime.
China has rigorous GB/T requirements for battery safety, recycling, and sustainability compliance, guaranteeing responsible leasing operations. Challenges exist, though, especially with supply chain disruptions and the significant capital investment needed in battery-swapping infrastructure. Nonetheless, government policies continue to support battery leasing through financial incentives and subsidies, helping offset some of these costs.
In 2025, the battery leasing services market is expected to be extremely competitive. Based on its first mover advantage in battery-swapping and the relatively high penetration it has achieved across China and Europe; NIO is estimated to capture an 18-22 % share of the industry. CATL is the other leading player, with a 15-20 % share, but with growing competition from local players.
Sun Mobility is expected to hold 12-16 % of the sector due to its robust base in India's electric two and three-wheeler industries, whereas Gogoro is likely to reach a 10-14 % share since it continues to dominate two-wheeler battery swapping in Taiwan and Southeast Asia.
Ample is predicted to capture 5-8 % of share, benefiting from its modular battery-swapping solutions for ride-hailing and delivery fleets in the USA and Europe, while BYD could make up 8-12 % in commercial EV battery leasing in China and developing enterprises. Shell Recharge Solutions can gain a 6-9 % share as it grows battery leasing for electric fleets in Africa as well as Europe.
GoodWe and Growatt, which are gradually entering battery leasing, are expected to hold about 3-5 %, with competition arising from effective low-cost designs. Chinese challengers and other regional players could quickly ramp up to the 3-5 % range by using cheap pricing and localized supply chain advantages.
Other small players and regional players may contribute 5-10% to the industry on demand for decentralizedenergy storage.Atthesame time, legacy players like ABB could account for 4-7%, while Tesla’s potential entry into the industry remains uncertain, though potential industry consolidation mayreshapethe landscape by 2025.
Battery leasing lowers upfront costs, provides flexibility for upgrades, and eliminates concerns about battery degradation and replacement.
Users pay a fixed monthly fee for access to a battery, often with the option to swap it for a fully charged one, ensuring cost predictability and convenience.
Passenger EVs and commercial fleets benefit the most from leasing, as it reduces capital investment while maintaining operational efficiency and affordability.
Incentives, subsidies, and regulations promoting battery recycling and sustainability encourage wider adoption of battery leasing among consumers and businesses.
It promotes battery reuse, minimizes electronic waste, and supports second-life applications in energy storage, enhancing overall sustainability efforts.
By business model, the industry is segmented into subscription service and pay-per-use model.
In terms of battery type, the industry is segmented into lithium-ion (li-ion) and nickel metal hybrid.
Based on vehicle type, the industry is segmented into passenger vehicles and commercial vehicles.
The industry is segmented by region into North America, Latin America, Western Europe, South Asia & Pacific, East Asia, Middle East, and Africa.
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Battery Leasing Service Market
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