Hinduja Group’s Switch Mobility likely to cease U.K. manufacturing operations owning to losses

Switch U.K. will execute and complete all the orders on hand and will continue to provide aftermarket support for the existing vehicle operating. File
| Photo Credit: Special Arrangement

Amid lack of demand for electric buses in U.K. and Europe and mounting losses, the Board of Directors of Switch Mobility Limited U.K., a subsidiary of Hinduja Group’s Ashok Leyland Limited has approved commencement of consultation process with the employees which could lead to cessation of its manufacturing and assembly activities at the Sherburn facility in the United Kingdom. 

“Switch U.K. will execute and complete all the orders on hand and will continue to provide aftermarket support for the existing vehicle operating there,” the company said in a statement. 

Also read: Switch Mobility aspires to become a global player in e-mobility, says CEO

“The plan is to cater to the U.K. and Europe markets when market recovers, from Ashok Leyland’s alternate manufacturing sites in India and UAE,” it said. 

Shenu Agarwal, MD & CEO of Ashok Leyland, said, “While Ashok Leyland remained committed 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 U.K. market.”

K. M. Balaji, Chief Financial Officer, Ashok Leyland, said, “The potential cessation of manufacturing activities is expected to mitigate the losses of UK operations. The current cash flow requirements of Switch U.K. will be borne out of GBP 45 million of equity infusion already approved by the Board of Ashok Leyland in February this year.

Also read: Switch Mobility unveils two low-floor electric buses

“Switch India is doing much better than expected and should not require significant equity infusion in near future. On an overall basis the value accretion from Switch EV business is expected to be much more than the investments made in these entities,” he said. 

Meanwhile, Switch Mobility Automotive Limited, India is eying to grow multi-fold in the next few years.

“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 over 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,” Mr. Agarwal said.