Hinduja group flagship Ashok Leyland on Friday said it will invest Rs 1,000 crore in Uttar Pradesh to set up a bus manufacturing facility focused on clean mobility.
The company has inked a Memorandum of Understanding (MoU) with the Uttar Pradesh government to come up with the plant -- the company's first in the state -- the commercial vehicle major said in a statement.
The MoU will see the company set up an integrated commercial vehicle bus plant focused on green mobility near Lucknow, it added.
"Contingent on market adoption and demand of alternative fuel vehicles in the state, Ashok Leyland intends to invest up to Rs 1,000 crore in this new facility over the next few years," Ashok Leyland MD & CEO Shenu Agarwal said.
The company's mission to achieve net zero by 2048 is one of the triggers to set up the plant in Uttar Pradesh, he added.
Upon commencement of operations, the manufacturing facility will initially have the capacity to produce 2,500 buses a year, the company said.
The company intends to gradually expand this capacity to accommodate up to 5,000 vehicles per year over the next decade as the demand for electric and other types of buses is expected to grow substantially over the next few years, it added.
Once operational, this will be the seventh vehicle plant of Ashok Leyland in the country.
"The signing of this MoU... reaffirms our commitment to shaping the future of the commercial vehicle industry," Ashok Leyland Chairman Dheeraj Hinduja said.
Ashok Leyland is the second largest commercial vehicle maker in the country after Tata Motors.
Shares of Ashok Leyland shares were trading 1.7 per cent up at Rs 182.90 apiece on the BSE.