26-05-2025
EV resale boost? Maharashtra mandates battery health passports for buyers
Seeking to combat consumer hesitancy over resale value and battery longevity, the Maharashtra government has announced a policy that will introduce digital "battery passports" for all new electric vehicles (EVs), a first for the country.
As part of the state's recently-released EV policy, the digital battery passport will be used to track the health, usage and manufacturing details of an EV battery, a critical component which accounts for over half of an EV's value.
'The State shall introduce a digital battery passport to track key parameters such as manufacturing details, real-time health status, usage history, and end-of-life diagnostics,' Maharashtra's EV policy, notified on 23 May, said.
Currently, customers have to rely on the seller to know the real health of the battery.
Based on previous pilots of such a passport in Europe, customers may get to scan the batteries through a QR code to know the health and the relevant manufacturing details of the battery installed in their purchased vehicle.
While the Maharashtra government has introduced the battery passport in its policy, the details of how they will be issued and what role will companies play in issuing them remain unclear.
To be sure, Maharashtra is the second-largest electric vehicle market in the country, with 241,941 EVs sold in 2024. Uttar Pradesh led the EV market, with 369,102 EVs sold during the year.
Deloitte's 2025 Global Automotive Consumer study said that at least one in five car buyers flag uncertain resale value as one of the reasons for holding back on EV purchase.
The health of the battery becomes important, as it is responsible for the depreciation in an EV's value. Resellers and insurers also complain that the lack of a standard document to know the health of batteries makes things uncertain about the pricing of a vehicle.
Data from used car marketplace players Spinny and Cars24 showed that EVs lose value faster than traditional internal combustion engine (ICE) vehicles. CARS24 noted that three-to-five year-old popular ICE car models can retain more than 50% of their original value, unlike EVs.
Spinny's data suggested that on average, EVs resale value lags ICE vehicles' resale value by 3%. This means that the price of a 2023 EV model would have fallen by 23% if sold today, as compared to a 20% depreciation for a similar specification ICE vehicle. The gap can increase to as high as 6% the older the model gets.
'A digital battery passport brings transparency to the EV market, giving consumers clear information about the health and history of their vehicle's battery,' Nikhil Dhaka, policy lead at Primus Partner, said.
Dhaka noted that pilot projects in Europe have shown that a battery passport can provide a digital ID for each battery, sharing details about its performance and manufacturing history.
Presence of a standard document issued by an authority can help consumers trust the resale value as the exact status of the battery installed in the vehicle would then be known.
'For resellers, a battery passport provides objective data that builds confidence and justifies pricing in the used EV market. It reduces disputes and makes the valuation process more transparent,' Dhaka added.
The country's EV insurance industry also expects that the introduction of digital battery passports can help them standardize the process which will be key in deciding premiums for such insurance policies.
The country's EV insurance market is projected to reach $8.61 billion by financial year 2032 from $1.02 billion in 2024.
'From an insurance perspective, digital battery passports are a game-changer. They provide insurers with comprehensive data on battery health, lifecycle, and sourcing, enabling more accurate risk assessments and tailored pricing models,' Sandeep Dadia, chief executive and country head at Lockton India, said.
'This transparency reduces uncertainties, ensuring fair premiums for customers while enhancing trust among insurers, OEMs, dealers and end-users,' he added.
The introduction of such a document also comes at a time when the overall electric sales in the country are growing at a rapid pace. In 2024, electric two-wheeler, three-wheeler and four-wheeler sales in the country grew 27% to 1.94 million units.
Globally, the use of digital battery passports remains limited as of now. However, in 2023, the European Union introduced regulations which require all EV batteries over 2kWh to have the document from 1 February 2027.
