Ashok Leyland is set to unveil its first vehicle scrappage facility, operating under a franchise model.
The company has entered into an agreement with a Registered Vehicle Scrapping Facility (RVSF). "This positions Ashok Leyland strategically on our path to circularity and reducing our environmental impact," the company's annual report for FY24 stated.
Additionally, the Hinduja Group's flagship company is developing a digital platform called Re.AL for the used vehicle market. This platform will facilitate customers in reselling their vehicles in line with the government's vehicle scrappage policy.
As a major manufacturer of trucks and buses, Ashok Leyland expects the commercial vehicle industry to grow due to replacement demand, mandatory scrapping of older government vehicles, and steady macroeconomic growth.
Dheeraj Hinduja, Chairman of Ashok Leyland, highlighted in the annual report that the company is gearing up to offer a variety of products powered by alternative fuels, including battery-operated vehicles, which are currently undergoing trials.
The company is concentrating on technologies like battery electric, hydrogen ICE, fuel cell, LNG, and CNG. "Ashok Leyland is well-prepared to provide clean energy options beyond electric propulsion. Our CNG and LNG trucks and buses are already in operation, and we are making progress with methanol as a new fuel source. We have also deployed prototype green hydrogen trucks in real-world conditions. In essence, Ashok Leyland is ready to offer a comprehensive range of clean energy vehicles," he said.
Ashok Leyland is also making significant strides in the green mobility sector through its subsidiary, Switch Mobility, which focuses on electric buses and light commercial vehicles.
Currently, over 950 electric buses are deployed worldwide, with an expanding order pipeline. Sales in the European market are expected to commence later this year. Recently, the company introduced the Boss electric truck and is nearing the launch of a fully electric 55-tonne tractor-trailer.
"The EV sector is anticipated to thrive, supported by favorable government policies," Hinduja added.
With numerous new products across various fuel segments in development, the company's R&D expenditure as a percentage of turnover rose to 1.30 percent in FY24 from 1.19 percent in FY23.
In FY24, Ashok Leyland invested ₹1,525 crore in its mobility divisions. After acquiring a 100 percent stake in OHM Global Mobility Pvt Ltd (OHM India) from OHM International Mobility Ltd, UK, for a nominal amount of ₹1 lakh, it invested an additional ₹300 crore in OHM. The company also invested ₹1,200 crore in Optare Plc., UK, raising its stake to 92.59 percent.
Ashok Leyland and TVS Mobility Pvt Ltd have formed a joint venture, TVS Trucks and Buses Private Ltd (TVS Trucks), with Ashok Leyland investing approximately ₹25 crore and holding 49.90 percent of the paid-up share capital.
While advancing new energy technologies, Ashok Leyland is also expanding its traditional ICE product range to address market needs. The company plans to introduce at least six new light commercial vehicle products this fiscal year. "In FY24, more than 30 percent of our sales came from newly launched products," noted Hinduja.
Ashok Leyland's share price closed at ₹234.25, down 1.91 percent, on the BSE on Tuesday.
