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Ola Electric, the electric vehicle (EV) company led by Bhavish Aggarwal, has announced plans to lay off at least 500 employees as part of a significant restructuring initiative aimed at improving operational efficiency and addressing mounting losses. The company, which has faced controversies, including a government probe and consumer complaints, is making the move to cut redundancies and streamline its workforce in an effort to drive profitability.
The company, which specializes in electric two-wheelers, is facing a challenging financial period. In its latest financial report, Ola Electric revealed a 43% increase in net losses for the July-September quarter (Q2 FY25), reaching ₹495 crore, up from ₹347 crore in the previous quarter. Its revenue also fell by 26.1%, dropping from ₹1,644 crore in Q1 FY25 to ₹1,214 crore in Q2. Despite these setbacks, the company has sought to focus on reducing operating expenses and improving cost efficiencies.
Ola Electric’s market share has also seen a significant decline, dropping from 49% in Q1 to 33% in Q2, a reflection of increased competition and service network challenges. According to reports, the layoffs will affect multiple departments within the company as part of an ongoing effort to improve its bottom line. However, the company did not comment on the specifics of the layoffs or provide a timeline for the completion of the restructuring.
Ola Electric’s financial woes have also been reflected in its stock performance. The company’s shares have fallen sharply, with its market capitalization dropping by more than ₹38,000 crore in just a few months. On Friday, the stock price stood at ₹67, significantly lower than its debut price of ₹76 and over 56% down from its peak of ₹157.40.
In addition to financial challenges, Ola Electric has been grappling with customer complaints related to issues with its EVs, including problems with software, battery malfunctions, and jammed tyres. These concerns have prompted the Central Consumer Protection Authority (CCPA) to launch an investigation into the company’s consumer complaint redressal practices.
The restructuring and layoffs come at a critical time for Ola Electric, as it faces the dual pressure of increasing competition in the EV market and efforts to restore consumer confidence. The company is hoping that its focus on cost reduction and operational efficiency will help it regain its footing in an increasingly crowded market.
As Ola Electric moves forward with these changes, it remains to be seen how the restructuring will impact its ability to recover and grow in the competitive EV landscape.
Sources By Agencies
