Amid ongoing economic challenges in the UK and Europe and a slower-than-anticipated transition to electric vehicles (EVs) in public transport, Switch Mobility Limited UK (Switch UK) has announced the commencement of a consultation process that could lead to the cessation of its manufacturing and assembly operations at its Sherburn facility.
Despite this potential shutdown, Switch UK has assured that all existing orders will be completed, and aftermarket support for its current fleet will continue. Future demand from the UK and European markets will be catered to through Ashok Leyland’s manufacturing facilities in India and the UAE when market conditions improve.
Strategic Shift: India Emerges as the Growth Engine
While the UK struggles with the slow adoption of zero-emission buses, the EV market in India is witnessing exponential growth. Switch Mobility Automotive Ltd, India (Switch India) is now doubling down on the high-growth Indian EV market, which is expected to expand significantly in the coming years.
Shenu Agarwal, MD & CEO of Ashok Leyland, emphasized the rationale behind this shift, stating:
“Ashok Leyland has been committed to the UK market for over 15 years, but the adoption of zero-emission passenger vehicles has remained sluggish. This is the right time to mitigate losses in the UK. On the other hand, the EV bus market in India is booming. Switch India is on track to achieve EBITDA breakeven in FY25 and expects to triple its volumes in FY26, backed by 1,800+ e-bus orders. In the e-LCV segment (2-3.5T), our market share exceeds 80%, with potential volume growth of 50-80% in FY26.”
Financial Restructuring to Mitigate UK Losses
K M Balaji, CFO of Ashok Leyland, highlighted the financial strategy to sustain operations during the transition:
“The cessation of UK manufacturing activities is expected to reduce financial losses. The immediate cash flow needs of Switch UK will be supported by the GBP 45 million equity infusion approved by Ashok Leyland’s Board in February 2025. Meanwhile, Switch India is exceeding expectations and is unlikely to require additional equity infusion in the near future. Overall, the value generated from the Switch EV business is projected to far exceed the investments made.”
A New Era for Switch Mobility
As Switch Mobility pivots towards India’s thriving EV market while scaling back its UK operations, the company aims to solidify its leadership in the global electric mobility space. This strategic move aligns with shifting market dynamics and positions Switch Mobility to capitalize on the surging demand for electric buses and light commercial vehicles in India and beyond.
