Localisation is at the heart of Ashok Leyland’s EV strategy. The company aims to indigenise batteries, which account for 40–50% of an electric vehicle’s cost. By doing so, it seeks to derisk its EV play from heavy import dependence and volatile global supply chains.
To achieve this, the commercial vehicle maker has entered into a long-term partnership with China’s CALB Group to develop and manufacture lithium iron phosphate (LFP) batteries in India.
CEO & MD Shenu Agarwal said the alliance, involving an estimated ₹5,000 crore investment over 7–10 years, will start with battery pack assembly before scaling up to cell manufacturing and advanced components. A Global Centre of Excellence is also planned in India to focus on battery chemistry, recycling, thermal management, and advanced manufacturing processes.
“India’s EV supply chain today is almost fully import dependent, with 65% import content in electric trucks. We cannot wait until EV penetration reaches 5–10%. We need to start early to develop talent, innovation, and capability here in India,” Agarwal said.
EV Trucks Gaining Ground
Ashok Leyland has already rolled out electric trucks for applications such as mining, ports, cement and downhill routes, where regenerative braking enhances efficiency and lowers operating costs. “In these use cases, the economics are clear. That’s why customers like Adani are talking to us for as many as 2,000 electric trucks,” Agarwal said.
Although EV penetration in CVs remains below 1%, Agarwal expects large fleet orders and niche applications to accelerate growth. He underlined that adoption is driven not by upfront price parity but by 50–60% operating cost savings.
Phased Roadmap for EVs
The company follows a “start early but go step by step” approach. “If you invest big for 10 years today, you could be totally wrong because technology changes quickly. A phased entry — battery packs first, then R&D, then aggregates — is the right way,” Agarwal said.
Ashok Leyland is also pursuing LNG and hydrogen trucks, with hydrogen expected to reach commercialisation in 2–3 years. Agarwal noted these technologies will complement electrification as India’s freight ecosystem diversifies.
Internationally, the company is aligning its EV and alternative fuel strategy with GCC, Africa, SAARC and ASEAN markets, where adoption is expected to be faster than in Europe or the UK.
By accelerating localisation, Ashok Leyland seeks to lower costs and derisk its EV business from external shocks in the global battery supply chain, building resilience for the next phase of India’s green mobility journey.