PC: News18
Ola Electric, the leading manufacturer of electric vehicles, recently found itself at the receiving end of the stick as the Central Consumer Protection Authority (CCPA) issued a show-cause notice to this company.
The notice emanates from the mentioned regulatory entity on the higher tide of consumer grievances alleging maltreatment of rights, false trade practices, and other violations of consumer rights and unfair trade practices.
This has taken a toll on Ola Electric. The company’s share price went down 9% after the drama played out between CEO Bhavish Aggarwal and comedian Kunal Kamra on social media over customer issues.
Ola Electric has maintained that it will be able to address the issues raised in the CCPA notice within the 15-day period as stipulated. The notice is believed to not have any impact on the financials or operations of the company. It is worth mentioning that, of late, Ola Electric has been dealing with an enormous volume of complaints from customers, which stands at about 80,000 per month, according to recent disclosures.
Adding to the woes, Ola Electric went into a tailspin with its market share shrinking to 27% in September from a more robust 39% in July. This sideways trend says much about the competitive nature and changing consumer preferences of the electric vehicle market.
Additionally, Ola Electric has internal issues; on Monday, its Secretary and Compliance Officer resigned for personal reasons and commitments. From this, thus, there have been doubts about the company’s internal stability and leadership at this very sensitive juncture.
Ola Electric reported modest increase in revenues from operations in Q1 FY25 at Rs 1,644 crore, growing 2.8%. That, however, was enough to keep the losses at bay, which dropped by 16.6% to Rs 347 crore. Ola Electric saw the revenues stood at Rs 5,010 crore, balancing it with a loss of Rs 1,584 crore over FY24 as a reflection of an intricate balance between revenue generation and cost management in a competitive market environment.
At the latest market data, shares of Ola Electric stand at Rs 89.01, with a market capitalization of Rs 39,256 crore, approximately $4.6 billion. The fluctuating market performance coupled with regulatory challenges and internal restructuring is very much an indication of a period of transition and strategic recalibration as Ola Electric looks towards navigating through a very complex business landscape.
The blending of these factors from regulatory and market sides with internal changes emphasizes a huge need for Ola Electric to focus more on delivering consumer satisfaction, operational efficiency, and strategic decision-making to sustain its competitive advantage and regain market confidence in its electric vehicle ecosystem.
