26th March 2025
The gradual shift from internal combustion engines (ICE) to electric vehicles (EVs) in the mass public transportation sector, particularly buses, in the UK and Europe, has adversely affected Switch Mobility UK, a subsidiary of Ashok Leyland. The company has decided to halt manufacturing operations at its Sherburn facility due to increasing financial losses.
Today, the Board of Directors of Switch Mobility Limited UK (Switch UK) approved the initiation of a consultation process with employees, which may lead to the discontinuation of manufacturing and assembly activities at the Sherburn site, as stated in a regulatory filing to the stock exchanges.
K M Balaji, Chief Financial Officer of Ashok Leyland, noted that the potential halt in manufacturing is anticipated to help reduce losses from UK operations. The current cash flow needs of Switch UK will be supported by a previously approved equity infusion of GBP 45 million from the Board of Ashok Leyland in February of this year. Meanwhile, Switch India is performing better than expected and is not anticipated to require significant additional equity in the near future. Overall, the value generated from the Switch EV business is expected to exceed the investments made in these entities.
Rather than continuing operations in the UK, Switch plans to fulfill future orders from Ashok Leyland’s alternative manufacturing facilities located in India and the UAE.
Instead of continuing the operations in UK Switch has palnnned support future orders from Ashok Leyland’s alternate manufacturing sites in Indiaand UAE.
Shedding more light on the development Shenu Agarwal, MD & CEO, Ashok Leyland, said, “While Ashok Leyland remainedcommitted to the UK market over the last 15 years, adoption of zero emission passenger
vehicles has been tepid. This seems to be the right time to cut down losses in the UK market.
On the other hand, the EV bus market in India is doing exceptionally well. Switch India is likely
to achieve EBITDA breakeven in FY25, and is hoping to treble volumes in FY26, on back of
1800+ e-Bus orders in hand. In e-LCVs, within the 2-3.5T segment, the Company’s market
share is at 80% plus, with prospects of 50-80% volume growth in FY26”. He indicated
Switch has also said that the company however is committed to execute and complete all the orders on hand and will continue to provideaftermarket support for the existing vehicle partsT
At the same time, the Switch Mobility Automotive Ltd, India (Switch India) is planningto double-down on the high-growth India EV market, which is poised to grow multi-fold in the next few years, company officials informed
Switch has decided to cease operations in the UK and will instead fulfill future orders from Ashok Leyland’s alternative manufacturing facilities in India and the UAE.
Elaborating on this decision, Shenu Agarwal, Managing Director and CEO of Ashok Leyland, stated, “Despite Ashok Leyland’s commitment to the UK market over the past 15 years, the uptake of zero-emission passenger vehicles has been slow. This appears to be an opportune moment to minimize losses in the UK market. Conversely, the electric bus market in India is thriving. Switch India is expected to reach EBITDA breakeven by FY25 and aims to triple its volumes in FY26, supported by over 1,800 e-Bus orders currently in hand. In the electric light commercial vehicle (e-LCV) sector, the company holds a market share exceeding 80% in the 2-3.5T segment, with anticipated volume growth of 50-80% in FY26.” He further indicated that
Switch is committed to fulfilling all existing orders and will continue to provide aftermarket support for current vehicle parts.
Simultaneously, Switch Mobility Automotive Ltd, India (Switch India) is planning to intensify its focus on the rapidly expanding Indian EV market, which is expected to experience significant growth in the coming years, as reported by company officials.
