Switch Mobility, the electric bus-making subsidiary of Ashok Leyland, and transport-technology start-up Chalo have joined hands for deploying 5,000 electric buses in a deal worth ₹8,000 crore, making it the largest electric bus deal in India to date . A memorandum of understanding (MoU) for an initial period of three years, was signed on Thursday between the two companies.

The buses with seating capacity of at least 30, will have recliner seats and air-conditioning, among other features and will be deployed across metros and other cities. In June, Swith Mobility had showcased the 35-45 seater Switch EiV 12, which has a driving range of 300km and a fast charging capability of 1.5-3 hours.

Ashok Leyland’s subsidiary, Switch Mobility India, will own these buses and provide them on rental basis or gross cost contract (GCC) to Chalo, which will be the operator.

Mahesh Babu, CEO, Switch Mobility India and COO, Switch Mobility, said, “We have the subsidiary OHM Mobility which will buy these buses from Switch. OHM will then give these buses on a monthly rental or GCC model to private players like Chalo. OHM is yet to be made functional in India.

Revenue sharing model

Switch will invest in the bus and will maintain it while Chalo will invest in consumer experience, charging infrastructure, drivers, IT and connectivity. Switch and Chalo have a revenue sharing model, the two companies informed.

Chalo will deploy its consumer technology solutions such as the Chalo App and the Chalo Card, offering conveniences such as live bus tracking, digital tickets, and travel plans. It will also determine routes, frequency, schedules, and fares.

Chalo, which bought the Amazon-backed office shuttle service Shuttl last year, has been in operation since 2014 and claims to be one of the largest tech-based private bus operators in the country. “We make sure that the people waiting for the bus know when exactly the bus will come. We also make sure that they have the ability to make a travel plan of their choice. We do this for 40 cities in India across 7,000 buses. We deliver 125 million rides every month,” said Mohit Dubey, Co-founder and CEO, Chalo.

Electric bus mobility is gathering pace in India. A few months ago Tata Motors, one of the largest bus makers in India, bagged a lion’s share of the 5,450 orders for electric buses through a tender floated by Convergence Energy Services (CESL).