Ola electric vehicles on a bumpy ride as social media takes stock

Comedian Kunal Kamra and Ola's Aggarwal engaged in a verbal duel on X

Ola Electric, which made a stock exchange debut two months ago, has been in the middle of considerable social media angst recently. On Sunday, things took an unexpected turn. Comedian Kunal Kamra and Ola founder Bhavish Aggarwal engaged in a heated social media spat, that turned viral on X. While Kamra raised issues around the service quality related to Ola EVs, tagging road transport and highways minister Nitin Gadkari, Aggarwal referred to the comedian’s tweet as “paid’’. Kamra posted an image showing many EV scooters parked at an Ola service centre, prompting Aggarwal to ask his critic to help fix the issues or sit quiet.

In the midst of the spat, the 39-year-old entrepreneur has acknowledged the need to fix issues. “We’re expanding the service network fast and backlogs will be cleared soon,’’ he posted on X on Sunday. A day later, on Monday, Ola Electric shares fell around 8 per cent, marking an overall 43 per cent drop from its all-time high of Rs 157.40 apiece.  
 

The company did not respond to a detailed questionnaire from Business Standard on the Ola EV concerns raised by consumers and its falling sales. But, social media continues to call out. Last week, for instance, Pitambar Panda, a product designer from Pune took to LinkedIn to share his six-month journey as an Ola electric two-wheeler (e2W) owner. “Please take the vehicle back. I made a very foolish decision to buy an Ola scooter six months ago,” he said. Panda alleged that he landed up in the hospital because his Ola scooter suddenly stalled mid-ride, causing a crash that resulted in a broken collarbone.

When Business Standard contacted Panda when he was in the hospital undergoing check-ups, he reiterated the details of his social media post. 

Another customer turned his frustration into a theatrical display, hoisting his scooter onto a rickshaw and belting out a parody of the Bollywood hit Tadap Tadap. Videos of Ola scooters going up in flames and a disgruntled customer torching an Ola showroom have also had a good run on the social media.
 

Ola’s smooth ride as a market leader in the e2W segment appears to have encountered a speed bump too, as the company has started to lose ground as the top selling player. Its sales have declined despite a 1.2 per cent growth in the overall electric vehicle market. Ola’s month-on-month sales in September fell by 10.6 per cent to 24,665 units, down from 27,589 units in August. Its competitors Bajaj, TVS, and Ather have gained momentum.
 

Despite Ola’s decline of over 10 per cent, the e2W segment has only decreased by 1 per cent, indicating that other players are stepping in to fill the gap left by the market leader.
 

However, the firm recently announced plans to double its network of service stations to 1,000 by December 2024, from 500 now.
 

The ride so far
 

Ola, which first hit the throttle with its electric scooters on August 15, 2021 — India’s 75th Independence Day — began delivering its S1 and S1 Pro models in December 2021 with a modest 240 vehicles. By January 2022, the company was racing past the 1,000-sale milestone, and in just five months, it accelerated to over 10,000 deliveries. It took another 11 months to reach 20,000, a milestone achieved by March 2023. The pace picked up again, with Ola zooming past 30,000 monthly deliveries by November 2023, and hitting its peak with 50,000 monthly sales in March 2024. But since then, the brakes have kicked in. The company clocked a sales figure of 24,665 in September—that was the lowest since October 2023.

 

After a stellar run post-listing on August 9, Ola Electric’s shares hit an all-time high of Rs 157.40 on August 20. However, by September 30, the stock had plunged below the Rs 100 mark for the first time since mid-August, closing at Rs 97.85 per share. On Monday, the stock closed at Rs 90.82 on NSE. The company’s losses have widened to Rs 347 crore in the April-June quarter, from Rs 267 crore during the same period last year.
 

Way forward
 

Industry experts have pointed out that the company must defend its market share, with  rivals closing in. The company, which cornered over half of the e2W market with a commanding 52 per cent share in April, has seen the figure plummet to 27 per cent by September. “Ola Electric should shift gears from expanding market share to fortifying its existing position and safeguarding its hard-won ground against encroaching competitors,” said Preetesh Singh, a specialist in CASE and alternative powertrains at NRI Consulting & Solutions.
 

The festival season may be a good time for a litmus test.

CCPA notice for Ola Electric

The Central Consumer Protection Authority (CCPA) has reportedly issued a show cause notice to Ola Electric, addressing thousands of consumer complaints about service deficiencies. The notice, dated October 3, cites potential violations of the Consumer Protection Act, 2019, including misleading ads, unfair trade practices, and consumer rights violations, according to media reports. Ola Electric has been given 15 days to respond.