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Informist, Tuesday, Sept. 2, 2025

 

--Ashok Leyland: CALB Group presently major EV battery pack supplier to co

--Ashok Leyland: See need of 4-6 GWh EV battery for captive use 4-5 yrs

--Ashok Leyland: To focus on Lithium ion phosphate-based batteries

--Ashok Leyland: May sell EV batteries commercially in later phases

--Ashok Leyland: Having own EV battery mfg to give competitive edge

--Ashok Leyland: CALB to supply EV battery cells initially to make packs

--Ashok Leyland: Yet to decide location to set up EV battery mfg unit

--Ashok Leyland: In talks with various states to set up EV battery mfg units

--CONTEXT: Ashok Leyland mgmt comments in a analyst conference call

--Ashok Leyland:To spend INR 3 bln-INR 6 bln initially on EV battery pack mfg

 

By Narayana Krishna and Shakshi Jain

 

HYDERABAD/NEW DELHI – Ashok Leyland Ltd. plans to invest INR 3 billion-INR 6 billion in the next two-three years to set up a localised electric battery pack assembly unit and the unit is expected to begin production by the first half 2027, Managing Director Shenu Agarwal said in a conference call with analysts. On Monday, Ashok Leyland had announced plans to enter electric battery manufacturing in partnership with China's CALB group, with an investment outlay of up to INR 50 billion over 7-10 years.

 

The company is focusing on lithium-ion-phosphate or LFP-based technology and the initial capacity will be used to meet its captive consumption, said Agarwal, who addressed the call along with Chief Financial Officer K.M. Balaji.

 

"Within the packs, we shall start with addressing our captive requirements for electric commercial vehicles. Later, we intend to expand to other automotive segments such as passenger cars, two- and three-wheelers, etc. Subsequently, we would also like to address non-automotive applications such as battery energy storage systems," the management said.

 

The company expects that at least 4 GWh to 6 GWh capacity is needed for its captive consumption for the next four-five years. Once it is able to meet captive consumption, it might consider selling its battery packs on a commercial basis to others, the management said.

 

The company wants to use its battery packs for Ashok Leyland and other group companies, including Switch. 

 

"Depending on the rate of adoption of electric vehicles and battery storage systems in India, and also our capability to master these new technologies, at the right time, we shall consider investment in cells as well," the management said.

 

The company said the most important part of the initiative was creating a centre of excellence, which would serve as a hub for research and development, fostering innovation in battery technology, recycling, battery management systems, and advanced manufacturing processes. 

 

In the long term, the centre of excellence would provide a competitive edge by creating new core competencies and knowhow in this emerging sector, Ashok Leyland said.

 

As far as the partnership with CALB Group is concerned, the scope is broad-based, starting with import of cells and local production of battery packs in India for both automotive and non-automotive applications, the company said. CALB is currently one of the major suppliers of battery packs to the company. As per the agreement, CALB will supply cells, while Ashok Leyland would assemble the battery packs as per local needs.

 

Ashok Leyland is yet to decide on the location of the electric battery factory as well as the commencement date. The management said it was in discussions with various state governments to find a suitable location for its plant. While several other details related to the project would be finalised in due course, the management said the centre of excellence and battery business unit would be housed in a separate entity under Ashok Leyland. No investments from CALB group were envisaged at this point of time, the company said.

 

It added that the segment was at an initial phase and the adoption of EVs was not more than 2-3%. Once EV battery adoption increased and reached a reasonable scale, the EV batteries business would provide reasonable margins, the company said.

 

"We decided 30-40 years ago, that we will have our own engines and that really gave us a lot of strength. This is something similar and actually more important because the cost of a battery pack and the related components in an electric vehicle would be more than the cost of the engine as a percentage of the total cost of the vehicle. So, we have to see it from that aspect that it will really give us a competitive edge if we can control the technology, if we have the knowhow and we can control the manufacturing process so as to have a competitive edge," the company said.

 

On Tuesday, shares of Ashok Leyland ended at INR 130.39 on the National Stock Exchange, up 1.8% from the previous close.  End

 

Edited by Avishek Dutta

 

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