ASHOK LEYLAND to transfer its electric vehicles business to a new arm Switch Mobility
By the end of this year, the new company plans to launch an electric van in India aimed at commercial fleet operators. The company claims to have already received 2,000 advance orders.
Commercial vehicles manufacturer Ashok Leyland plans to merge its entire electric vehicle (EV) business, including UK-based Optare, into a new firm called Switch Mobility.
Within the next few months, an electric van will be launched by the new company in India aimed at fleet operators of commercial vehicles. The company claims it has already received 2,000 orders in advance for the same.
A new e-mobility services business will also be included under the Ohm brand. As part of this business move, the company will provide EVs under an operating expense (op-ex) model, including in India, as well as apply for various government tenders.
Several buses have been supplied by Ashok Leyland to Indian government transport agencies under the FAME-2 government policy designed to promote electric vehicles.
As of now, Ashok Leyland has invested $130 million in Optare’s EV business, but the truck and bus maker is not planning to invest more money in the company in the near future.
Over the next few years, Switch Mobility expects to need about $150-200 million in investments for product and capacity development.
On investments, Dheeraj Hinduja, chairman of Ashok Leyland stated, “Ashok Leyland isn’t going to be investing substantially, Switch Mobility must create its own funds, whether through equity or debt.”
Multiple financial and strategic partners have expressed interest in investing in Switch Mobility, Hinduja added.
All of Ashok Leyland’s EV-related intellectual property, as well as Optare, will be owned by the new company. From now on, all EVs will be sold under the Switch brand, including those sold in India.
The UK and India will both serve as manufacturing bases, with India serving primarily local and emerging economies alike. The Switch Mobility will also rely on Ashok Leyland’s purchasing power as an important sourcing base in India.
The consolidation move will help Ashok Leyland to concentrate on its core business of diesel-powered vehicles along with alternative fuels like CNG, LNG, and hydrogen.
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