Ola Electric Planning to Lay Off Many Workers to Improve Margin

Restructuring is being done in Ola Electric, one of the big electric two-wheeler companies. Because of this, more than 500 workers may be thrown out of the company. This layoff can happen in different divisions. For the last few months, Ola Electric has been facing difficulties due to deficiencies in service.

In a media report quoting sources having information about this, it has been said that the company is trying to improve its margins to become profitable. Ola Electric had also done restructuring two years ago. As of March this year, the company had 4,011 workers. This company, invested by Japan’s SoftBank, is incurring losses due to higher costs and reduced subsidies for electric vehicles (EV). Recently Ola Electric was listed on the stock market. However, the company’s share price has also declined in the last few weeks.

However, Ola Electric continues to hold the first position in the electric two-wheelers market with more than 30 percent share. The notice was given due to complaints regarding the quality and delay in service of the company’s electric scooters. Bureau of Indian Standards (BIS) will investigate the company in this matter. Earlier, the Central Consumer Protection Authority (CCPA) had issued a notice to Ola Electric after a large number of complaints. Last month, CCPA had sought response from the company regarding about 10,000 complaints from customers. However, Ola Electric had said that it has resolved more than 99 percent of these complaints.

After reviewing the company’s response, CCPA has entrusted BIS with the responsibility of conducting a detailed investigation into the matter. Ola Electric’s loss has been less in the last quarter. Ola Electric’s consolidated loss declined to approximately Rs 4.95 billion in the July-September quarter. In the same period last year, this loss was about Rs 5.24 billion. In the last quarter, the company’s revenue increased by more than 39 percent to about Rs 12.14 billion. This has been helped by the increase in sales of electric scooters priced below Rs 1 lakh. It will soon start manufacturing electric motorcycles.