Ola Electric Faces Headwinds Amid Registration Woes and Market Competition
April 3, 2025, 5:54 am
Ola Electric Mobility Ltd is navigating a storm. The company, once a shining star in the electric scooter market, is now grappling with significant registration issues. In March 2025, for the first time, Ola did not disclose its monthly sales figures. This silence speaks volumes. It follows a month-long lull in vehicle registrations, raising eyebrows and concerns among investors and consumers alike.
The backdrop is troubling. Ola reported 23,450 new vehicle registrations in March, according to the government’s Vahan portal. However, this figure reflects registrations, not actual sales. A month prior, Ola had warned that the Vahan portal would not accurately capture its sales due to registration process hiccups. The company’s shift to in-house vehicle registrations in February has led to disruptions.
Ola Electric claimed it was clearing a backlog of over 16,000 vehicles. Yet, the March numbers suggest that only around 6,000 new vehicles were registered. This has dragged Ola down to third place in market share, a stark contrast to its previous position as a market leader. The electric two-wheeler race is heating up, with competitors like Bajaj Auto and TVS Motors surging ahead. Bajaj Auto reported 34,863 new registrations in March, a staggering 62% increase from February. TVS Motors followed closely with 30,454 registrations, also reflecting a robust month-on-month growth.
The overall electric vehicle market in India closed FY25 on a high note, with registrations rising 16.86% to 1.96 million units. Yet, Ola’s struggles are evident. The company’s revenue for FY25 is likely to take a hit due to these registration woes. Without clear monthly sales figures, it’s impossible to gauge the full impact on revenue or the incentives Ola might forfeit. The company recognizes revenue upon transferring control of products to customers. However, unregistered vehicles complicate this process.
Ola’s registration backlog could also jeopardize its eligibility for government incentives under the PM E-drive scheme. This scheme allows manufacturers to sell electric vehicles at subsidized prices, with the government reimbursing the difference. The clock is ticking. The ₹10,900-crore fund is spread over FY25 and FY26, with incentives halving from ₹10,000 to ₹5,000 per vehicle in FY26. Vehicles sold in FY25 but registered in April will only qualify for the lower subsidy.
Investor sentiment is shaky. Ola’s share price has dropped nearly 13% amid these registration challenges. The company is far from its ambitious target of 50,000 registrations, a benchmark set by founder Bhavish Aggarwal for profitability. In the last quarter of 2024, Ola reported a loss of ₹564 crore, up from ₹376 crore the previous year.
The road ahead is fraught with challenges. Ola must resolve its technical issues and ramp up production sustainably. The company’s future hinges on its ability to clear the registration backlog and restore investor confidence. The market is watching closely.
Meanwhile, the introduction of OBD II-B emission norms for two-wheelers on April 1, 2025, adds another layer of complexity. However, the impact on sales is expected to be minimal. Two-wheeler manufacturers, including Hero MotoCorp and Honda Motorcycle & Scooter India, have already transitioned to comply with these new norms. Price hikes are anticipated to be modest, ranging from ₹800 to ₹3,000.
Hero MotoCorp has been proactive, ensuring its entire portfolio is compliant well ahead of the deadline. The company’s executive director indicated that the price increase would be minimal, primarily due to the existing fuel injection systems in their vehicles. This strategic move positions them favorably in a competitive landscape.
As the electric vehicle market evolves, Ola Electric must adapt quickly. The company is at a crossroads. It can either rise to the occasion or risk being overshadowed by competitors. The electric scooter market is not just about technology; it’s about execution.
In conclusion, Ola Electric’s journey is a cautionary tale. The company’s initial promise is now clouded by operational challenges and fierce competition. The next few months will be critical. Will Ola clear its backlog and reclaim its position? Or will it falter under pressure? The answers lie in the company’s ability to navigate these turbulent waters. The electric vehicle revolution is here, but only the nimble will thrive.
The backdrop is troubling. Ola reported 23,450 new vehicle registrations in March, according to the government’s Vahan portal. However, this figure reflects registrations, not actual sales. A month prior, Ola had warned that the Vahan portal would not accurately capture its sales due to registration process hiccups. The company’s shift to in-house vehicle registrations in February has led to disruptions.
Ola Electric claimed it was clearing a backlog of over 16,000 vehicles. Yet, the March numbers suggest that only around 6,000 new vehicles were registered. This has dragged Ola down to third place in market share, a stark contrast to its previous position as a market leader. The electric two-wheeler race is heating up, with competitors like Bajaj Auto and TVS Motors surging ahead. Bajaj Auto reported 34,863 new registrations in March, a staggering 62% increase from February. TVS Motors followed closely with 30,454 registrations, also reflecting a robust month-on-month growth.
The overall electric vehicle market in India closed FY25 on a high note, with registrations rising 16.86% to 1.96 million units. Yet, Ola’s struggles are evident. The company’s revenue for FY25 is likely to take a hit due to these registration woes. Without clear monthly sales figures, it’s impossible to gauge the full impact on revenue or the incentives Ola might forfeit. The company recognizes revenue upon transferring control of products to customers. However, unregistered vehicles complicate this process.
Ola’s registration backlog could also jeopardize its eligibility for government incentives under the PM E-drive scheme. This scheme allows manufacturers to sell electric vehicles at subsidized prices, with the government reimbursing the difference. The clock is ticking. The ₹10,900-crore fund is spread over FY25 and FY26, with incentives halving from ₹10,000 to ₹5,000 per vehicle in FY26. Vehicles sold in FY25 but registered in April will only qualify for the lower subsidy.
Investor sentiment is shaky. Ola’s share price has dropped nearly 13% amid these registration challenges. The company is far from its ambitious target of 50,000 registrations, a benchmark set by founder Bhavish Aggarwal for profitability. In the last quarter of 2024, Ola reported a loss of ₹564 crore, up from ₹376 crore the previous year.
The road ahead is fraught with challenges. Ola must resolve its technical issues and ramp up production sustainably. The company’s future hinges on its ability to clear the registration backlog and restore investor confidence. The market is watching closely.
Meanwhile, the introduction of OBD II-B emission norms for two-wheelers on April 1, 2025, adds another layer of complexity. However, the impact on sales is expected to be minimal. Two-wheeler manufacturers, including Hero MotoCorp and Honda Motorcycle & Scooter India, have already transitioned to comply with these new norms. Price hikes are anticipated to be modest, ranging from ₹800 to ₹3,000.
Hero MotoCorp has been proactive, ensuring its entire portfolio is compliant well ahead of the deadline. The company’s executive director indicated that the price increase would be minimal, primarily due to the existing fuel injection systems in their vehicles. This strategic move positions them favorably in a competitive landscape.
As the electric vehicle market evolves, Ola Electric must adapt quickly. The company is at a crossroads. It can either rise to the occasion or risk being overshadowed by competitors. The electric scooter market is not just about technology; it’s about execution.
In conclusion, Ola Electric’s journey is a cautionary tale. The company’s initial promise is now clouded by operational challenges and fierce competition. The next few months will be critical. Will Ola clear its backlog and reclaim its position? Or will it falter under pressure? The answers lie in the company’s ability to navigate these turbulent waters. The electric vehicle revolution is here, but only the nimble will thrive.