Ola entered the electric vehicle (EV) space with a bang. In July last year, its electric scooters saw 1 lakh reservations in just 24 hours of opening of pre-launch bookings.
Its main competitors Hero Electric, Okinawa Autotech, and Aether Energy sold just 40,000, 24,000, and 14,000 units respectively in the last year, Autocar reported.
In a blog, CEO Bhavish Aggarwal said, "It was one of the highest sales in a day (by value) for a single product in Indian e-commerce history."
By all accounts Ola Electric was off to an excellent start, but cracks are beginning to show – delayed deliveries, missing features, and customer complaints.
Production of S1 Scooters Halted
Ola initially said it would start delivering its scooters in October 2021. Then it pushed the deliveries to November, then December.
This year, in January, the company announced that it will halt production of the Ola S1 till 2022 and will instead focus on manufacturing the premium S1 Pro model since it has seen more demand. Deliveries are slated for January and February.
Ola is now telling those who booked the vanilla model that it will upgrade them to the S1 Pro's hardware – without the upgraded features. For those they'll have to shell out an extra Rs 30,000.
The decision caused several customers to lash out at the company on Twitter.
"This is pure cheating with customer who booked normal S1 and waiting for long," said one buyer. "Request Ola not to follow unethical practices. No company takes 20k and not provide delivery 4-5 months," argued another.
What’s Causing the Delays?
The global semiconductor shortage is partly to blame.
“Due to the ongoing global shortage of chipsets and electronic parts, there are some unavoidable delays to your Ola S1 delivery,” Ola Electric said in an email sent to a customer, accessed by the Economic Times.
"We apologise for this delay and assure you that we are ramping up production as fast as we can so you can get your Ola S1 at the earliest,” the email added.
There are hardware issues as well. Several reviews of the Ola Electric S1 Pro complain about the batteries overheating, throttled response, and reduced range.
Features like cruise control, hill hold and navigation are also reportedly missing on the delivered scooters, and will be added with a software update later.
Ola, which is primarily a ridesharing company, may be facing trouble scaling up manufacturing and marrying software to hardware, which can lead to inefficiency in battery usage as well as performance and range issues.
A Bloomberg report suggests that Ola was only manufacturing about 150 scooters a day in December. The company has also seen several top management exits in the past two years.
The EV landscape is developing different in India compared to the United States and Europe.
Sales of electric two-wheelers in India jumped 132% in a year (from 1,00,700 units in 2020 to nearly 2,34,000 in 2021) according to a report from the Society of Manufacturers of Electric Vehicles.
(With inputs from Autocar, Bloomberg, and Economic Times)
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