Ola Electric opens 3,200 stores amid year of consumer complaint woes

BANGALORE: Ola Electric Mobility Ltd. announced opening of 3,200 new stores in a single day, as India’s biggest e-scooter maker seeks to expand its local footprint and address customer frustration related to shortcomings in service.

The Bengaluru-based Ola Electric has increased the number of showrooms and service centres to 4,000, Ankush Aggarwal, group head of financial services and retail auto business, said at an event on Wednesday.

The company, led by co-founder Bhavish Aggarwal, is looking to penetrate India’s small towns as well as bolster its after-sales service.

"By leveraging its direct-to-consumer (D2C) model, Ola is ensuring that EV ownership becomes a reality for every household,” the company said in an exchange filing last week.

Ola Electric’s single-day store launch blitz marks its attempts to revive its market share - and reputation - after a tumultuous year marked by a blockbuster listing in August followed by an onslaught of consumer complaints regulatory scrutiny and a heated spat between its chairman and a stand-up comedian.

Almost every Indian town, city and district would have an Ola Electric store and a service center, its Chairman Bhavish Aggarwal said in a Dec 19 video posted on X. The milestone was initially expected on Dec 20 but later pushed to Dec 25.

The massive rollout comes a couple of months after it got slammed by service and performance-linked customer complaints.

A monthly runrate of 80,000 such complaints were overwhelming its service centres, according to local media reports.

Videos and photos of malfunctioning Ola Scooters circulating on social media while Aggarwal had a social media altercation with an Indian comedian, who criticized the company’s flagship model.

Reputational turnaround

"Their service network is an area the company is trying to address” as it scripts a reputational turnaround, Jinesh Gandhi, analyst at Ambit Capital Pvt., told Bloomberg News.

India’s heavy industry ministry ordered an audit of the firm’s servicing hubs in October, Reuters reported, and the Central Consumer Protection Authority served a notice in October over alleged violation of customer rights, misleading ads and unfair trade practices.

This has led to market share loss for the sector leader - it dropped to 24.5% in November versus 32.6% in the same month last year. Ola Electric shares are now trading about 40% lower from their peak in August after the strong listing.

The store expansion plans might help lift its market share that is under pressure from rival automakers such as Bajaj auto Ltd. and TVS Motor Co.

Though Ola Electric in November launched e-scooters for gig workers who are powering India’s quick commerce economy, competition is fierce in one of the world’s biggest two-wheeler markets.

India’s No. 2 two-wheeler maker Honda Motorcycle and Scooter India Pvt. has also launched the electric version of India’s topselling scooter Activa.

The store openings are also in preparation of the upcoming vehicle launches, Ambit’s Gandhi said.

"The bigger challenge they need to address is getting the product quality right from day one of the launch.”