Having unveiled a new low-floor 12-meter City bus segment, Switch plans to come out with a new 9-meter bus and expand its intercity range in 2025-26
13 Dec 2024 | 3255 Views | By Ketan Thakkar
Switch Mobility, Ashok Leyland's electric vehicle arm, is ready to scale up its electric bus operations domestically and internationally with an expanded product portfolio and increased production capacity.
With a strong foundation laid with a revamped portfolio, the company is aiming to more than triple its volumes to over ...
This is an Autocar Pro Plus article. Subscribe to continue reading.
Switch Mobility, Ashok Leyland's electric vehicle arm, is ready to scale up its electric bus operations domestically and internationally with an expanded product portfolio and increased production capacity.
With a strong foundation laid with a revamped portfolio, the company is aiming to more than triple its volumes to over 3,000 units with a potential turnover of close to $450-500 million, which can now be termed Switch 2.0, says the company's CEO, Mahesh Babu to Autocar Professional.
"We are targeting a top three position in India and building a strong global presence," Mahesh Babu said. "With the right product, production capacity, and operational support in place, we are ready to deliver."
Switch Mobility launched two key products on Wednesday—Switch EIV-12 for India and Switch E1 for Europe—marking its first entry into the low-floor electric bus segment.
"We are now delivering low-floor buses for Indian and European markets for the first time," said Switch Mobility CEO. "The EIV-12 has been designed to meet India's operating conditions, while the E1 meets European standards."
The EIV-12 addresses urban challenges like accessibility, passenger convenience, and operational efficiency. It includes kneeling and tilting mechanisms for easier boarding, particularly for elderly passengers and differently abled individuals. Meanwhile, the E1 caters to Europe's stricter safety, emissions, and comfort regulations.
Global Expansion Plans
Switch is expanding its presence in international markets, starting with Europe, GCC, and Mauritius. The company has secured a Government of India tender to deliver 100 electric buses to Mauritius, a significant step in its global plans.
Switch will produce buses for the E1 platform in Europe at its UK facility. "For now, the UK facility will handle European demand. If volumes cross 120 units annually in markets like Spain, we will explore setting up localized plants," Babu clarified.
Switch is also in talks to activate a Ras Al Khaimah facility in the GCC region based on demand. Other emerging markets under consideration include Sri Lanka, Bhutan, Nepal, and parts of Africa.
"We have a globally competitive product portfolio, and it is the right time to explore international markets," said Babu.
Product Portfolio and Future Developments
Switch Mobility's current portfolio includes: EIV-12: Low-floor and standard-floor electric buses, EIV-22: Double-decker electric buses and IV3 and IV4: Light commercial electric vehicles.
Switch is also developing a 9-meter lightweight electric bus for smaller cities and towns. This new platform will focus on affordability, modular design, and efficient energy consumption. It is expected to launch by 2025.
Financial Strength and Funding Strategy
Switch became EBITDA-positive last year and is well-funded for its current operations. "We do not require external funding for ongoing projects or product development," Babu said. "Any strategic initiatives, like a battery plant or a new product platform, will require only minimal capital, which Ashok Leyland can support internally."
Babu says Switch Mobility will invest Rs 200 crore to Rs 300 crore in the next two to three years to manage the operations, which will be met through internal accruals.
In the long term, the company is not ruling out an IPO in the next 2–5 years. "We will pursue an IPO once we achieve the right scale and profitability," Babu said. There is no immediate urgency since we have adequate funding.
Growing Demand and Production Readiness
The company has an order book of 1,700 electric buses, with deliveries set to begin this year in Delhi, Bangalore, and Chennai. The company has expanded its production capacity to 3,000 buses annually to meet rising demand. Facilities in Hosur and Ennore are operational, and the upcoming plant in Uttar Pradesh will add capacity for another 2,000–3,000 buses annually.
"The Indian market is rapidly adopting electric buses, and we are ready to meet this demand," Babu noted. "With our facilities fully equipped, we are confident of delivering the existing orders and scaling up for future opportunities."
The company's recent participation in the CESL tender for 4,000 buses highlights the growing market potential. Switch and 12 other players, including private operators, participated in this tender.
Switch Mobility claims that across its current fleet of 700+ vehicles, the company maintains a 99% uptime rate and completes 95% of repairs on the same day.
"Reliability is critical in public transport. For example, our 300 buses in Bangalore have consistently outperformed expectations, with minimal downtime," Babu stated.
Switch's operational support is managed by its associate company, OHM Global Mobility, which handles maintenance, repair services, and operational efficiency.
Reforms Driving Indian Market Growth
While the electric bus market has shown promise over the years, deployment has been challenging due to viability concerns and the need for payment security mechanisms to protect against defaulting state transport undertakings (STUs).
India's electric bus market has undergone significant reforms recently, including standardized tenders and improved financing mechanisms—post-inclusion of the Payment Security Mechanism under the PM E-drive. Under the CESL and NITI Aayog framework, tender specifications are now uniform across multiple states, allowing manufacturers to produce standardized buses at scale.
The introduction of payment security mechanisms has also addressed funding challenges. "Banks are now more confident about financing electric buses because of the RBI-backed escrow arrangements in place," Babu explained.
The city bus segment remains a priority. With penetration already at 27%, demand is projected to grow from 4,000 buses annually to 12,000–13,000 buses by 2030. "The EIV-12 is designed specifically to meet the needs of this segment," he said. "It is efficient, accessible, and addresses the requirements of modern urban transportation systems."
Intercity Bus Opportunities
Switch Mobility also targets the intercity electric bus segment. The company recently secured a tender in Uttar Pradesh for 100 buses ranging from 300 km. Plans are underway to extend the range to 400 km next year to serve routes such as Chennai-Bangalore and Mumbai-Pune.
"Our existing EIV-12 platform can be modified to meet intercity requirements," Babu said. "We are focusing on medium-distance routes with electric buses, which are cost-effective and sustainable."
Production Facilities and Capacity
Switch's current production facilities can produce 3,000 buses annually. Once operational, the UP plant will add additional capacity, ensuring the company can meet increasing domestic and international demand.
In Europe, the UK facility will continue to handle production until 2027, after which Switch will assess the need for additional capacity in locations like Spain.
Switch Mobility's growth strategy focuses on scaling operations in India while expanding into Europe, GCC, and other emerging markets. With a focus on reliable operations, strong service support, and an expanding product portfolio, the company aims to secure a leading position in the electric bus segment.