Ashok Leyland’s battery plan may reach Rs 10,000 crore

Commercial vehicle major Ashok Leyland is gearing up for a significant push into domestic battery manufacturing, with total investments potentially reaching Rs 5,000–10,000 crore over the next 7–10 years, depending on the pace of India’s electric vehicle (EV) market expansion.

The company’s Managing Director and CEO, Shenu Agarwal, said the scale of investment will hinge on market demand for EVs and energy storage systems. “At present, we are maintaining a target of Rs 5,000 crore, but there is a possible upside depending on market adoption,” Agarwal told reporters during a post-results briefing.

In September, Ashok Leyland announced a partnership with China’s CALB Group, one of the world’s top three battery manufacturers, to produce next-generation batteries for both automotive and stationary energy storage applications. CALB currently operates with a global capacity of 90–100 GWh but will not be investing directly in the Indian venture, according to the agreement.

The battery venture will be rolled out in phases. The first phase involves a relatively modest investment of around Rs 500 crore over the next 18 months, focusing on battery pack assembly — integrating individual cells into complete packs ready for deployment in vehicles. The second phase, expected to require a substantially higher investment, will focus on setting up cell manufacturing facilities in India.

Agarwal said the company is evaluating multiple sites for the plant, with factors such as logistics, infrastructure, scale, and government incentives influencing the final decision. The location is likely to be finalised by December-end or early January.

Initially, the battery production will cater to captive demand from Ashok Leyland, its EV arm Switch Mobility, and other Hinduja Group companies. Combined, their projected battery requirements stand at 4–6 GWh over the next four to five years.

Switch Mobility, which specialises in electric buses and light commercial vehicles (e-LCVs), currently holds an order book exceeding 1,800 e-buses and aims to break even within this fiscal year. Its e-LCV range also forms a key part of Ashok Leyland’s EV strategy.

Once the in-house demand is met, the company plans to expand supply to external OEMs, spanning passenger vehicles, two-wheelers, three-wheelers, and energy storage applications. This diversification will help the company leverage economies of scale in India’s fast-evolving EV ecosystem.

Agarwal emphasised that the long-term vision is to establish a comprehensive local battery manufacturing ecosystem, reducing import dependence while supporting India’s clean mobility mission. “Our aim is to create a robust supply chain that supports both our internal needs and the larger EV industry,” he said.

With this, Ashok Leyland joins a growing list of Indian automakers betting big on domestic battery production to power the country’s electric future.