Ola Electric Facing Heat of Regulators Anger, BIS to Investigate its Service Standards

Challenges are increasing for Ola Electric, one of the big electric two-wheeler companies. 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) is going to 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. Reuters report states that after reviewing the company’s response, CCPA has given the responsibility to BIS to conduct a detailed investigation into the matter.

The large number of complaints and regulatory scrutiny against the company has also affected its share price. Ola Electric’s loss has been less in the last quarter. The company had said that recent customer complaints regarding service were due to ‘minor issues’. 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.

Between July and September, the company has delivered 98,619 units of electric scooters. Bhavish Aggarwal, founder of the company, said, “Not all service requests are complaints or product issues. Many of these are for routine maintenance. There were some challenges in our capacity in terms of service in the last quarter. Our sales have grown faster than the expansion of our service network.” Ola Electric has sold more than 50,000 units in October. However, this is the company’s wholesales. The company has maintained its first position in this market with more than 30 percent market share. Its sales have increased by more than 100 percent compared to September.