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The job cuts will affect multiple departments, including procurement, fulfilment, customer relations and charging infrastructure
This marks the company’s second round of job cuts in less than five months
In November 2024, Ola Electric laid off around 500 employees
Bhavish Aggarwal-led electric vehicle major is reportedly planning to lay off more than 1,000 employees and contract workers in an effort to stem its growing losses.
As per Bloomberg’s report, the job cuts will affect multiple departments, including procurement, fulfilment, customer relations and charging infrastructure. People familiar with the matter also said that the layoffs are part of Ola
Inc42 has reached out to Ola Electric for confirmation around the development. The story will be updated based on the responses.
This marks the company’s second round of job cuts in less than five months. In November 2024, Ola Electric laid off around 500 employees, and the latest round of dismissals accounts for over a quarter of its reported 4,000-strong workforce as of March 2024.
However, this figure does not include contract workers, who are not accounted for in the company’s official disclosures.
“We have restructured and automated our front-end operations delivering improved margins, reduced cost, and enhanced customer experience while eliminating redundant roles for better productivity”, the publication cited Ola’s spokesperson as saying this, without addressing the number of workers cut.
This comes at a time when Ola is grappling with financial challenges, reporting a 50% surge in losses for the December quarter to INR 564 Cr from INR 376 Cr in the year-ago quarter, hurt by lower revenue due to rising competition in the electric two-wheeler market. Sequentially, net loss rose 14% from INR 495 Cr amid declining electric vehicle (EV) sales.
In Q3 FY24, its operating revenue declined 19% year on year and 14% quarter on quarter to to INR 1,045 Cr.
The company has been battling challenges like buyer complaints, social media backlash, and market share loss, as it has lost ground against its rivals in the EV two-wheeler segment.
Just a few days back, the EV major also conveyed that it was in the middle of renegotiating its existing deal with service providers Rosemerta Digital Services Pvt Ltd and Shimnit India Pvt Ltd. This, it said, was expected to temporarily impact its vehicle registrations on the Vahan portal.
The above challenges have resulted in a steep downfall in Ola Electric’s share price. The stock is 63.91% below at previous closing price from its 52-week high of INR 157.53 reported on August 20 2024.
Even its market cap has seen a correction to INR 25,075 Cr (around $2.9 Bn at current exchange rates), whereas when it listed, this was close to $4 Bn.
About today’s trading, Ola Electric shares were down 3.47% at INR 54.88 at 3:25 PM on the BSE. Not just this, its shares tanked over 5% to hit a fresh all-time low of INR 53.71 apiece on the BSE on Monday (March 3).
