Ola Electric lays off 500 people across verticals to improve profit margins

Ola Electric Mobility is laying off people across verticals as a part of its restructuring exercise amid a decline in the company’s market share. It is cutting 500 jobs at several levels, according to people privy to the developments of the matter.

The company has been getting attention for the wrong reasons recently, mainly for its poor aftersales service. It started laying off people in the September quarter and the exercise is expected to be finished by the end of this month.

"It has been going on for some time now, starting around July. It has been a gradual process of removing redundant roles across verticals and levels," said a source to PTI.

The source added that Ola Electric is seeking workforce optimisation, aiming for better profit margins.

Manufacturing and supply chain management departments have suffered the most from the job cuts, according to a report by the Economic Times (ET). People aware of the developments have said that the company has already terminated 300-400 workers, or nearly 10% of its workforce, over the past couple of months, the report added.

"There is high churn to the tune of 50% on an annual basis anyway. If you do not fill in these positions, your people count will naturally come down. On top of that, if you initiate a job cut, it will further reduce the workforce size," ET quoted a source.

CCPA probe

Earlier in November, the Central Consumer Protection Authority (CCPA) ordered a detailed investigation into the complaints related to the poor quality of services in the electric two-wheelers manufactured by Ola Electric. The company said that it has resolved 99.1% of the 10,644 complaints it received from CCPA in the month of October.

About the company

Ola Electric Mobility is a major electric vehicle (EV) manufacturing company in India. Its expertise lies in vertical integration of technology and producing EVs and their components. It currently operates in 782 company-owned stores, all delivering 130 sales on average per quarter, which is nearly 2-3 times the industry average, as per a company release.

The company posted a consolidated net loss of ₹495 crore for the July-September quarter, declining from ₹524 crore in the year-ago period. Ola Electric posted Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) of ₹379 crore for the quarter ending September, increasing from ₹435 crore reported in the same quarter of the previous year.