Free run to bumpy ride

Ola Electric faces many challenges on road to future

- PEERZADA ABRAR

In 2021, Bhavish Aggarwal stood on a dusty plot in the Krishnagiri district of Tamil Nadu, and promised to build the world's largest electric two-wheeler factory. Within eight months—and despite the challenges posed by the Covid19 pandemic—that vision became the Ola Futurefactory. The facility, staffed entirely by women and run mainly by robots, aims to have an annual production capacity of 10 million units in future.

Backed by SoftBank, Ola Electric quickly became the market leader. Soon after, it made a blockbuster market debut in 2024, its IPO valuing the firm at $4.8 billion.

Cut to 2025. Bengaluru-based Ola Electric's losses more than doubled in the quarter ended March as vehicle deliveries fell sharply and revenue declined. The company posted a net loss of ₹870 crore in the fourth quarter ended March 2025. The revenue from operations tumbled 62 per cent year-on-year (Y-o-Y) to ₹611 crore during the quarter under review. Vehicle shipments during the quarter fell to 51,375 units, down from 115,000 a year ago.

Clearly, some of the bullishness of the early days has gone missing. Ola's market share is slipping amid rising competition from incumbents like Bajaj Auto and TVS. Customers are voicing concerns regarding product quality and regulators are watching. Recent exits by Hyundai and Kia have raised fresh doubts. The challenge for Aggarwal—once hailed as India's Elon Musk—is whether his bold vision is enough to weather the storm.

"When Ola Electric came in, they had a free run," said an industry executive. "This is the first time they're facing a real slump."

And, analysts are wary. "Ola Electric launched the bike, they stuffed the market with inventory, and they had an initial brand following which led to good sales," said Vinit Bolinjkar, head of research at Ventura Securities. However, this early momentum has proven unsustainable as numbers have seen a significant drop despite establishing 4,000 distributor outlets.