Tag Archives: Ola Electric

Ola Electric Shares Drop 3% to Rs.87.44 Amid Pricing Investigation and Regulatory Scrutiny

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Shares of Ola Electric fell nearly 3% on Monday, marking the third straight session of decline, as the company faces scrutiny over its pricing practices. The Automotive Research Association of India (ARAI), under the Ministry of Heavy Industries, has asked the electric vehicle (EV) manufacturer to clarify recent price cuts on its S1 X 2 kWh electric scooter during a promotional sale.

Ola Electric’s stock closed at Rs 87.44 per share, continuing its decline from an all-time high of Rs 157.40. If the company fails to provide a satisfactory explanation to the ARAI, it could face legal action and may lose access to subsidies offered under the government’s PM Electric DRIVE Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) scheme.

Reports suggest that if pricing violations are discovered, Ola Electric could face penalties in line with E-DRIVE guidelines. The probe adds to the growing list of regulatory challenges facing Bhavish Aggarwal’s EV firm.

Growing Consumer Complaints

In addition to the ARAI inquiry, Ola Electric has been hit with a notice from the Central Consumer Protection Authority (CCPA). The notice follows over 10,000 complaints filed with the National Consumer Helpline (NCH) over the past year, mostly related to poor after-sales service.

Ola Electric has been given 15 days to respond to the CCPA’s show-cause notice. The complaints range from unresolved technical issues to delays in refunds and subpar customer support.

The government has also directed Ola Electric to implement better consumer protections for its ride-hailing services, including offering customers the option to choose their preferred refund method and ensuring that proper invoices are provided for all auto rides booked through its platform. Since the beginning of 2024, over 2,000 complaints have been registered against Ola’s ride-hailing service, many citing discrepancies between the fare shown at booking and the amount charged.

The ongoing investigations and consumer complaints highlight the challenges Ola Electric faces in maintaining customer trust and complying with regulatory standards. As Ola continues to expand its EV portfolio, addressing these issues will be crucial for restoring investor confidence and ensuring long-term growth.

Over-Confidence Runs Ola Electric Dreams Down to Gutter, Stock Prices Plummet Further

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Ola Electric, once hailed as a trailblazer in India’s electric vehicle (EV) market, is now grappling with a host of challenges that threaten to derail its success. From a show-cause notice issued by the Central Consumer Protection Authority (CCPA) to a flurry of customer complaints and a sharp decline in stock prices, the company is under intense scrutiny.

On Tuesday, the company’s stock hit a record low of Rs 86 per share, a staggering 43% drop from its all-time high of Rs 157.40 just a few days prior. Though it recovered slightly, the decline is a far cry from its debut price of Rs 76, raising concerns about investor confidence in the Bhavish Aggarwal-led firm.

Ola Electric acknowledged receiving the show-cause notice from the CCPA in a stock exchange filing, stating, “The Central Consumer Protection Authority has provided a timeline of 15 days to the company to respond… We will respond within the given timeframe with supporting documents.”

The notice cited several potential violations of the Consumer Protection Act, 2019, and highlighted a litany of complaints from consumers, including manufacturing defects, unresolved issues despite servicing, partial or no refunds on cancellations, and inaccuracies in billing. Most notably, recurring battery problems have plagued Ola’s flagship electric scooters, undermining the brand’s reputation in a market already skeptical of EV reliability.

The National Consumer Helpline, managed by the Department of Consumer Affairs, has reportedly received over 10,000 complaints against Ola Electric since September 2023, signaling widespread dissatisfaction. Nidhi Khare, Secretary of the Department of Consumer Affairs, noted, “The CCPA is looking into a large number of complaints about Ola Electric, mainly related to service inefficiencies. We hope the company addresses these concerns promptly.”

Meanwhile, discontented customers have taken to social media to air their grievances. From faulty hardware to unresolved software issues, complaints about the company’s service centers and the poor quality of its e-scooters are mounting.

One frustrated user shared on X (formerly Twitter), “Even after the big announcement in service expansion, service centers are working the same. I delivered my scooter to Ola 3 weeks ago… Though it’s not properly fixed, OLA asked me to book RSA under my cost. I regret my decision to buy this scooter in 2022.” Another user criticized the design flaws, writing, “Ola scooters… are poorly engineered products. The OLA updated 2.0 platform has taken away any repairability… How is any of this GREEN?”

Ola Electric’s woes come at a critical juncture for India’s EV market. The company initially gained significant traction by positioning itself as a key player in the country’s green mobility push. Its e-scooters, which garnered attention for their sleek design and promise of high performance, were seen as a revolutionary step toward a more sustainable transportation system.

However, this momentum has been marred by quality control issues and complaints of inadequate after-sales service. The ongoing scrutiny from the CCPA and the mounting consumer dissatisfaction now threaten to overshadow the company’s potential.

Historically, rapid growth in the tech or EV space often brings operational challenges, particularly in emerging markets like India. Ola Electric’s struggles echo those of other global EV giants, including Tesla, which faced significant criticism early on for quality issues and delays in servicing. The difference lies in how companies respond to such setbacks. While Tesla was able to eventually overcome these challenges, it remains to be seen if Ola Electric can similarly recalibrate and rebuild consumer trust.

For now, the company is at a crossroads. With the stock price sliding, regulatory pressure mounting, and consumer confidence waning, Ola Electric faces an uphill battle to regain its footing in the competitive EV space. The coming weeks will be crucial in determining whether the company can address these challenges or if it risks skidding further off the road.

EV battered Ola fires 200 techies, 10% of workforce

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Ride-hailing major Ola on Monday clarified that nearly 200 engineers, including some in the software vertical, have been asked to go from its 2,000-strong engineer workforce — 10 per cent of the headcount — as part of a larger restructuring exercise towards its electric dream.

The company denied sacking 500 employees, adding that it is “centralising operations and is undertaking a restructuring exercise to minimise redundancy and build a strong lateral structure that strengthens relevant roles and functions”.

CNBC first reported that nearly 500 employees are being laid off from the various software verticals of ANI technologies which operates as Ola Cabs.

“The company currently has around 2,000 engineers and aims to increase its engineering talent pool to 5,000 over the next 18 months,” said the ride-hailing company.

The Bhavish Aggarwal-run company has nearly 1,100 employees in its core ride-hailing business.

Earlier restructuring exercises impacted employees across product, marketing, sales, supply, tech, business, and operations verticals at the company, affecting nearly 500 employees that “were a result of restructuring in the Cars and Dash businesses”.

The ride-hailing major recently shut down its used vehicle business Ola Cars, as well as its quick-commerce business, Ola Dash, as the company shifted focus on its electric two-wheeler and car verticals.

Ola said it plans to hire 5,000 engineers as it doubles down on new engineering verticals and strengthens capabilities across vehicle, cell, battery, manufacturing and autonomous streams.

However, Ola Electric’s sales are diminishing and it sold 3,421 EV two-wheelers in August, a drop from 3,862 units the company sold in July.

More than half a dozen senior executives have quit Ola Electric in recent months while over 30 senior executives have left Ola in the past two years.

Recently, Ola Electric’s head of advanced battery engineering, Ashok Saraswat, moved on. Saraswat, who joined SoftBank-backed Ola last year, is reportedly joining a company that is entering the battery business.

As EV two-wheeler sales drop amid battery fire fears, Okinawa Autotech, PureEV and Ola Electric recalled 6,656 vehicles after the battery explosion incidents increased in the country.

The government has said it is extra vigilant about the safety standards of EVs and experts are on the job.