Ola Electric to lay off 450-500 employees in restructuring exercise
The EV-maker is reportedly undertaking laying off in means to quicken the company’s target to reach profitability.
Nikhil Patwardhan
Friday November 22, 2024 , 2 min Read
Ola Electric has undertaken a restructuring exercise that will affect 450-500 employees, a person familiar with the matter told YourStory.
The source added that the exercise will be conducted over the next month.
Moneycontrol was the first to report on the matter.
The round of layoffs is expected to help the company improve margins and reach profitability, the source said.
Bhavish Aggarwal-led Ola Electric reported a wider quarter-on-quarter net loss for the quarter ended September 30th to Rs 495 crore from Rs 324 crore in the first quarter.
The company, currently the market leader in the electric two-wheeler segment, is also struggling to sell its vehicles. In September, it sold the fewest vehicles so far this year and saw its market share drop below 30% for the first time in 2024. For the July-September quarter, Ola Electric's market share dropped to 33% from 49% in the previous quarter.
In its second-quarter shareholder letter, the company said that it faced a capacity issue over the last couple of months due to service capacity growth lagging behind its sales volume growth. However, Ola Electric reiterated that it has resolved almost all the backlog and that it is now processing about 80% of service requests in T+1 days .
The EV-maker has been plagued with a mounting number of customer complaints about its two-wheelers and high regulatory scrutiny over its customer service.
The company is currently being investigated by the Central Consumer Protection Authority (CCPA) following concerns that Ola Electric’s claims of addressing 99.1% of all complaints were not true, according to multiple reports.
These issues have had ripple effects on the company’s share price which is currently trading lower than its debut price of Rs 76.
Ola Electric shares are trading at Rs 68.82, up 2.5% on BSE as of 12:51 PM today.
(Shradha Sharma, Founder and CEO of YourStory, is an independent director in Ola Electric)
Edited by Affirunisa Kankudti