Ashok Leyland recovers after crashing 10% in pre-open; check two key developments you need to know

However, the stock recovered later and, when last seen, was trading nearly 2% lower at ₹210.85 on the BSE.

Firstly, the company, in its filing to stock exchanges, said that amid continuing general economic uncertainty faced in both the UK and Europe and a slower than expected transition to EVs in public transport, the Board of Directors of Switch Mobility Limited UK (Switch UK) on Thursday approved the commencement of a consultation process with the employees, which could potentially lead to the cessation of its manufacturing and assembly activities at the Sherburn facility.

Switch UK will execute and complete all the orders on hand and will continue to provide aftermarket support for the existing vehicle parc.

The plan is to cater to the UK and European markets when the market recovers, from Ashok Leyland’s alternate manufacturing sites in India and the UAE, the company said in its press release.

At the same time, Switch Mobility Automotive Ltd, India (Switch India) is planning to double down on the high-growth Indian EV market, which is poised to grow multi-fold in the next few years.

Switch Mobility Ltd, UK, is a step-down subsidiary of Ashok Leyland. It is a manufacturer of electric buses having a presence across the UK and Europe.

Commenting on the move, Shenu Agarwal, MD & CEO, 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 UK market.

On the other hand, 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 the back of 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.”

At the current market price of Ashok Leyland, that stake is valued at over ₹6,400 crore. As of December 31 last year, Hinduja Automotive held a 35% stake in the company.

This weighed on the stock, as high levels of promoter share pledging can signal financial distress and thereby negatively impact investor sentiment.