Regulatory hassle on the mobility of Ora electric powered by bhavish appears to be intensifying as local electric vehicle manufacturers expand rapidly in physical displays.
Since 2022, Ola Electric has increased its physical stores to 4,000. For about 3,400 showrooms with data, only 100 locations have trade certificates, Bloomberg report notes. These certificates are regulatory requirements under the Motor Vehicle Law.
This means that for Ola Electric’s brick-and-mortar stores, there is a lack of certification required for display, for sale, and for unregistered two-wheelers, the report adds.
Transportation officials respond to complaints: Raid, shutdown, displaying the cause of the sent business
In response to customer complaints, state transport authorities raided Ola Electric showrooms and closed some of them. Additionally, Berenberg News reported that the vehicle was caught and a notice was issued.
“The Motor Vehicle Act provides that every vehicle showroom, including two-wheelers, should clearly show a trade certificate, including two-wheelers,” Hans Kumar, retired Assistant Transport Commissioner in Rajasthan, told the agency.
Ola says Bloomberg report is “misplaced, biased”
“Your findings’ findings are wrong and biased,” an OLA spokesperson said in an emailed reply. He added that Ola kept a list of unregistered vehicles in distribution centers and warehouses in various states of India, “which is fully in line with the guidance of the Automobile Act and has obtained the necessary approvals.
Ola’s response did not directly answer whether their public-oriented stores had a trade certificate or that the company witnessed raids and seizures from local transport regulators.
Livemint cannot independently verify these developments. Ola Electric’s share fell more than 4% on Monday, March 10, negatively responding to the development.
Crisis Fight: Layouts, regulatory troubles, delayed launch
Once India’s largest scooter maker, the startup is now fighting multiple fronts. Stocks have fallen by more than 60% since their listing in August.
It also faces complaints about quality and service issues, strong social media opposition and expanded losses in recent months. Agwar said in an article published on X in October that Ora is expanding its network to resolve customer complaints.
Bloomberg News reported this month that regulatory challenges face as the company assumes the responsibilities of more than a thousand employees and contract workers. Ola acknowledged that some characters became redundant due to recasting and automating part of their operations.
Since Aggarwal showed it has also delayed delayed electronic functions since its launch in January last year. An OLA spokesman did not answer questions about delaying the launch of the motorcycle.
According to nearly twenty notices issued by state-level transport officials and reported by Bloomberg News, India’s transport officials have been reviewed and often found that Aola has no trade certificate requirements at the store level.
According to Bloomberg News documents, Ola applied sporadically and obtained a trade certificate from certain locations in response to notifications or raids from the transport department.
The first warning about these violations dates back to at least 2023, with the latest update to early March. Transport officials in several states confirmed that an investigation into Ola’s showroom operations is underway.
Among all regulatory actions, Ola announced a blitzkrieg launch in December, adding more than 3,200 new locations. According to Bloomberg News filings, most of these new stores do not have the necessary trade certificates.
OLA’s email responses did not comment on the survey by the transport officer or the lack of certification in these new stores.
According to documents from Bloomberg News, Ola told transport authorities from at least the end of 2023 that its experience center is for “customer engagement” rather than direct sales.
Ola told the exchange on February 19 that it is renegotiating terms with two of its agencies engaged in vehicle registration in government regional transport offices. It added that this will affect the February vehicle registration number in the government database.
Red flags: Sales digital gap and registration
The scooter maker said in a Feb. 28 exchange filing that it had sold “more than 25,000 cars” last month, while government portal Vahan showed that more than 8,600 were registered. This huge gap could be a red flag as customers cannot receive unregistered vehicles in India.
Indian automakers usually only calculate registered vehicles in their sales. Even a week after Ola announced its exchange sales numbers, there was no vehicle with all invoices registered – local rules extended it to a seven-day window – at risk of conflicting with state government laws.
“The February 2025 registration data will be updated in the Vahan portal in the coming weeks,” an Ola spokesperson said in an email.
The wide range of store-level non-compliance is under rising pressure to increase scooter sales and share prices.
According to data compiled by the government’s Vahan database, Ola also lost market share and was at its highest point in the two-wheeler market – heritage manufacturers Bajaj Auto Ltd. and TVS Motor Co., obtained the ground.
Despite growing challenges, Aola’s Aggarwal said the company will release turnover soon.
“What we can expect is about 50,000 monthly sales EBITDA break even,” Agwal told analysts on a Feb. 7 revenue call. “We can indeed reach about 50,000 in the next few quarters.”
(with Bloomberg input)
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