Ola Electric Layoffs: Bhavish Aggarwal’s Ola Electric Mobility Ltd. is experiencing a roller coaster ride as it attempts to maintain its position as the nation’s top and sustainable manufacturer of electric two-wheelers. As part of its cost-cutting plan, the electric scooter manufacturer has allegedly started firing more than 1,000 staff and contract workers in a variety of areas.

As the business attempts to control expenses and address growing losses, the layoffs will affect areas including buying, customer relations, supply, and charging infrastructure, according to many media sources.

Share price decline and market difficulties

Ola Electric’s shares has dropped 60% from the start of its spectacular initial public offering (IPO) in August 2023. The company’s overall success has been harmed by problems including diminishing market share, bad social media comments, and consumer complaints.

In spite of these obstacles, Ola Electric said that it sold over 25,000 scooters in February, gaining a 28 percent market share. This amount is still much less than its monthly sales goal of 50,000 units, however.

The business also cautioned investors that while it renegotiates contracts with important suppliers to increase cost effectiveness and operational efficiency, car registrations may continue to drop.

Five months of layoffs in a row

In only five months, Ola Electric has already implemented its second major wave of layoffs. The business has lately been having financial issues, even with SoftBank Group Corp.’s assistance. In the December quarter, its losses increased by 50%, attracting the attention of consumer protection organizations and market authorities.

About 500 workers were let off by Ola Electric in November 2023. As of March 2024, the firm employed over 4,000 people, although over 25% of its staff is now affected by the most recent wave of layoffs.

Pay attention to cost effectiveness and automation.

Ola Electric has automated its customer support operations as part of its reorganization initiatives in an attempt to boost productivity and save expenses. According to a Bloomberg article, the business has already automated a number of crucial front-end procedures, which has increased customer satisfaction, decreased expenses, and increased profitability.

In an effort to improve logistics and delivery processes and decrease expenses, Ola Electric has also reduced the number of sales, service, and warehousing employees across showrooms and service centers.