Switch Mobility aims to be in EV markets around the globe: CEO

Markets will come back after geopolitical turbulence and each company will have to make its own strategy, says Mahesh Babu

Switch Mobility expects the market for electric buses to double next year, says Mahesh Babu, chief executive officer, India and chief operating officer of the start-up owned by Ashok Leyland. The "big advantage" for Switch Mobility is its synergy with Ashok Leyland, he told Shine Jacob in an interview.

What is the role of Switch Mobility in Ashok Leyland’s journey towards electric vehicles?

Firstly, Switch is positioned as a global company. We are headquartered in UK, we have offices in Chennai, Spain and several other locations. Switch has a vision of democratising zero-carbon mobility. Our intention is to bring globally, people to public transport in electric mobility. These two areas we will do in the passenger as well as in the goods segment. We have taken two segments: bus and also light commercial vehicles up to 7.5 tonne. Switch will be looking at electrification across the globe – including the UK, Spain, Middle East, South East Asia, India, Africa and other countries, where we want to participate in these two segments.

Switch, being a subsidiary of Ashok Leyland, will have a lot of synergies and support from the company, the platform, manufacturing channel and many more. That is the big advantage for us, while we are a start-up 20 months old, we have leveraged Ashok Leyland assets significantly in the past two years. We are trying to get the maximum asset utilization to bring the best products to our customers.

How many buses did you supply in the Indian market so far and how do you see the growth potential?

We had about 100 buses at the start of the year, supplied in the last four years. There are two portions to it, one is the India portion and another is the UK portion. We have around 100 electric buses running in the UK as well. We kicked off in India last October. When we made Switch, we had around 65 buses on the road and we were delivering the first 40 last financial year taking around 105 buses on the road.

Now, we have around 600-plus orders this year. From last year, delivery of 60 buses to 600 buses is the journey we have taken. It is a very substantial task and the team is working to get into that level of growth this financial year.

In September, you sold 39 per cent of the total buses sold. Do you see it as a good sign for the company?

Absolutely, if you look at last year to this year, our expectation was that the market will double and next year to triple. I am happy that this year, numbers are growing at more than double the rate. Last month, in September, we had substantial delivery with BMTC (Bangalore Metropolitan Transport Corporation), which we are delivering right now. We have many more buses in the pipeline. It is very happy to see that we are contributing to the electric mobility transition in India.

How are you looking at the upcoming tenders by the government?

Firstly, we will have to give credit to the government of India and CESL for coming up with some fantastic, futuristic tenders. India has committed to net zero by 2070 and a lot of work is happening in this decade up to 2030 on electrification and solar and many renewable energy actions, both in mobility and energy. That is putting a lot of industry investment and action towards sustainable mobility, which is a vision of Switch as well. I appreciate CESL for taking the next tender, draft is almost out for another 5400 buses. This is just a beginning and every year we have a potential to add about 5,000 to 10,000 buses going forward. Many developed countries, like Germany last year, have sold only 500 electric buses. But India has registered more than 1,000 and this year is likely to be more than 2,000 this year.

How is the global expansion strategy of Switch be going ahead, specially with the crisis in the international market?

India is doing extremely well in the turbulent situation globally. Europe has an energy crisis, there is a war going on, the UK has seen a leadership change and we have seen a lot of flip-flops in its policies. I believe it will stabilize. We are in the UK, we are looking at Europe through Spain, we are looking at African countries, Middle East, South East Asia and have sent a bus to Japan to explore possibilities. We are going to be present long-term globally. Each country and each region will have challenges at multiple points of time, so we have to work around it and take specific action related to what is happening in geopolitics. Scale up or scale down business, plan accordingly. In the long run, we believe that the markets will come back after the turbulent times are over.

What will be your strategy regarding light commercial vehicle (LCV)?

We will be there with LCVs during the next financial year. That strategy is intact and we are working hard to get the products out. Our strategy is to be below 7,5 tonnes on EVs, which will be the first one to adapt on a mass scale. We are working on a strategy for how to participate on a global scale. Since there is too much traction in the bus segment right now in India, we don’t want to lose this. As you have seen, we are leading and also participating in this segment. We don’t want to lose the momentum. We want to make sure that the bus segment is actively participating, and that enough products are there.

You were in talks with financial investors for raising funds. What is the status of it?

We have talked about it a lot. Since the market in India is futuristic, I don’t see any issue in financing either from the group or a strategic partner who will come and work with us for scaling up the business globally. We are working with partners who will invest in it and it is as per the plan, and if it goes well by the end of this financial year, we will have all the partners in place.

We talked about $250-300 million between Switch and Ohm and we are working on it.

What is the role of Ohm Global Mobility in the Switch scheme of things?                                                                                                         

India is running mostly GCC (gross cost contract) models for our buses. As OEM (original equipment manufacturer), Switch is the manufacturer and distributor and channel partner for electric buses and LCVs. We need a company which will capitalize these buses and run on pay per kilometer basis. E-mass (e-mobility as a service) is the service which they do; we are looking at battery as a service, vehicle as a service, and (are) working on multiple options around it. Ohm Mobility, which is a sister concern of Switch, will focus on offering multiple services to our customers. They will run the operations, do charging, scale up on renewable energy. They are working on net zero on operations as well. Switch and Ohm will complement each other.

How do you see the pace of the transition?

We had a turbulent period in the last 12 to 18 months, raw material prices went up, fuel prices went up, and interest rates are moving up. What is good is India is the only country that has not taken away the path of electrification or any other initiative on capital expenditure, whether it is infrastructure, road, now, I am happy that India is in the path of growth, particularly in sustainable mobility. We are able to take care of the growth rate of the country’s GDP. We have learned a lot and are well prepared compared to what we were 20 months back.

Are we out of the supply-side bottlenecks and chip crisis?

The situation has improved and we have learned to handle it well. There are many more turbulences, war is not yet over and geo-political positioning happening. This is going to be not a one-time affair. I think we need to understand and try to handle the situation without affecting our numbers.

What is your growth roadmap?

Our parent company Ashok Leyland is one of the leaders in the market. Our intention is to be in the top three in India and we want to be participating in multiple markets around the globe. Our intention is to achieve net zero in many of the operations and to democratize zero-carbon mobility.