Ola Electric Says Cost-Cutting Initiatives Helping Save INR 90 Cr Per Month

Bhavish Aggarwal-led Ola Electric has said that its cost-cutting initiatives are helping it reduce the cash burn by INR 90 Cr per month.

In a statement, the company said that it has completed the implementation of the cost-cutting measures under the ‘Network Transformation and Opex Reduction Program’, which was launched in November last year.

As a result, the electric mobility company expects its automotive segment to achieve EBITDA breakeven in the first quarter of the fiscal year 2025-26 (Q1 FY26), it said in an exchange filing.

Ola Electric saw its consolidated net loss zoom 50% to INR 564 Cr in Q3 FY25 amid a degrowth in its top line and rising competition in the electric two-wheeler market. Operating revenue plummeted 19% to INR 1,045 Cr during the quarter from INR 1,296 Cr in the same period last year.

Ola Electric’s cost-cutting measures involved shutting all regional warehouses, shipping vehicles, spare parts and accessories directly from factories to stores, automating registration and productivity improvements in the sales and services network.

These changes have also helped the company reduce average vehicle inventory to 20 days from 35 and slash delivery time for customers to 3-4 days from 12 days earlier, it claimed.

The EV manufacturer further said that it is in the final stages of revamping its vehicle registration process. It claimed that average daily registrations for its EVs have increased to 800, crossing the average daily sales for the January-February period.

As per Vahan data, Ola Electric’s two-wheeler registrations slipped 66% month-on-month to 8,390 units last month amid a decline in EV sales in the country. 

The company had forewarned that its registrations on the Vahan portal were likely to be ‘temporarily’ impacted as it was in the middle of renegotiating its existing agreement with service providers Rosemerta and Shimnit. However, Ola Electric claimed earlier that it sold over 25,000 units in February and remained a leader in the E2W segment with a market share of 28%.

At 12:29 PM, shares of Ola Electric were trading 0.37% higher at INR 51.10 apiece on the BSE. The stock crashed nearly 6% on Tuesday (March 11) to INR 50.66, its lowest since listing on the stock exchanges last August. 

Meanwhile, founder and CEO Aggarwal last week pledged an additional 5.88 Cr of his shares in the EV company to secure more debt for his AI venture Krutrim.