Ola Electric Ropes In EY India To Overhaul Distribution Network

EV major Ola Electric

has reportedly roped in consulting firm Ernst & Young (EY) to overhaul its distribution network. 

Citing sources, NDTV Profit reported that EY will help Ola Electric “achieve regional compliance” as the EV manufacturer looks to push the pedal on same-day deliveries with its recently announced “HyperDelivery” offering. 

Inc42 has reached out to Ola Electric for comments on the development. The story will be updated based on the response.

This is the second time that the listed company has hired the consulting firm in the past six months. In October 2024, Ola Electric roped in EY India to fix its service-related issues. However, the EV maker terminated its partnership with the consulting firm two months later over disagreements with founder and chairman and managing director Bhavish Aggarwal. 

Meanwhile, the EV maker has now reportedly informed the Maharashtra transport department that it is in the process of applying for trade certificates for all of its stores in the state. 

“We’re committed to ensure that we are fully compliant with the law and have either already applied for or are in the process of applying for relevant licences and approvals, including trade certificates for our stores,” Ola Electric told Maharashtra’s joint transport commissioner Ravi Gaikwad in a letter, dated April 5, as per a separate NDTV Profit report. 

This comes nearly a week after Maharashtra’s transport minister Pratap Sarnaik said that more than 300 Ola Electric stores in the state were operating on a single trade certificate, adding that the government would take penal action against the company “if the situation demands so”. 

Ola Electric’s Many Troubles

The partnership with EY comes at a time when Ola Electric has come under regulatory scrutiny as well as faced the ire of customers for below-par after-sales services, late deliveries, among other reasons. Not just this, the company is also facing investigations for reportedly operating 95% of its outlets without necessary trade certificates. 

With EY India’s help, Ola Electric could be looking to plug the compliance gaps and address regulatory bottlenecks. 

As part of its efforts to cut losses to improve its bottom line, the company began restructuring its operations earlier this year. Under this exercise, it began renegotiating its contracts with registration agencies to bring down expenses. However, this led to a delay in registrations of its EVs in February. 

Following this, one of the company’s vendors, Rosmerta Digital Services, also filed an insolvency petition against a subsidiary of Ola Electric. While the insolvency filing was later withdrawn, the EV manufacturer found itself under the scrutiny for mismatch in registration and sales data. 

Ola Electric’s vehicle registrations on Vahan portal stood at 8,600 units in February, but the company publicly claimed that it sold over 25,000 vehicles that month. Following this, the roads, transport and highways ministry (MoRTH) and heavy industries ministry (MHI) sent inquiries to the company for the data mismatch. 

As if this was not enough, a media report recently also alleged that Ola Electric counted bookings of its “unlaunched” electric bike and new electric scooters in its February sales data. However, the EV maker clarified that the sales number was based on paid and confirmed orders, not “preliminary bookings”.

Nevertheless, the EV giant has hired EY India as it looks to shore up its retail expansion. In February, Ola Electric shut all its regional warehouses across India and moved to an in-house model. Under this, the company plans to utilise its network of 4,400 retail stores to maintain vehicle inventory, spare parts, accessories, and last-mile deliveries.

That said, the overhaul of the distribution model and moving registration and other processes in-house is part of the company’s bid to trim costs amid rising competition from legacy players and dwindling stock prices. 

On the financial front, Ola Electric’s net loss zoomed 50% to INR 564 Cr in the third quarter (Q3) of the fiscal year 2024-25 (FY25) from INR 376 Cr in the year-ago quarter. Operating revenue declined 19% to INR 1,045 Cr during the quarter under review from INR 1,296 Cr in Q3 FY24. 

Shares of the company closed today’s trading session 1.53% lower at INR 50.12 on the BSE.