Transport ministry seeks explanation from Ola Electric on customer complaints over quality issues

The transport ministry has written to Ola Electric seeking an explanation for alleged quality issues reported by customers about the company’s electric scooters. 

The 11 October letter directs the EV manufacturer to provide details on affected models, the number of units sold, and the steps being taken to address mounting customer complaints. Mint has seen a copy of the letter.

The ministry also asked Ola Electric if it has initiated any voluntary recall process to address potential safety risks.

Mint reported in September that the company has been receiving as many as 80,000 complaints every month, even as it stepped up efforts to tackle service issues by assembling a new service team and expanding the number of workshops.

Also Read: Ola Electric claims to resolve 10,644 customer complaints amid social media feud

At the same time, according to the Central Consumer Protection Authority (CCPA), the national consumer helpline received just about 10,000 complaints over the span of a year. Note that not all complaints are reported to the authorities.

The ministry's letter follows a show-cause notice sent by the CCPA regarding complaints over scooter malfunctions, breakdowns, and safety hazards. The ministry has asked Ola to submit a comprehensive response within a week, stressing the urgency of the matter.

Multiple inquiries

This inquiry is the latest in a series of investigations Ola Electric has faced from various government bodies. 

In its response to the CCPA, Ola claimed to have resolved 99.1% of the 10,644 complaints forwarded by the authority. 

Also Read: Kunal Kamra slams Ola CEO Bhavish Aggarwal over EV scooters again, explains why it's a ‘public issue’

Ola Electric has also been questioned by the Automotive Research Association of India and the ministry of heavy industries in the last two weeks. 

Emails seeking comments sent to Ola Electric and the transport ministry remained unanswered at the time of publishing.

The government’s inquiry comes at a critical juncture for Ola Electric, which has positioned itself as a leading player in India’s electric vehicle push. The company has enjoyed significant success, but its market share has been flagging in recent months as competition from incumbent rivals intensifies.

Competition is particularly intense from Bajaj Auto which has ramped up sales in recent months, weakening Ola's grip. Ola's electric two-wheeler market share slipped to 27% in September 2024, from nearly 50% in April and below 30% for the first time in a year, a Mint analysis of the government's vehicle registration data showed.

Also Read: Ola Electric share price soars nearly 4% as market share expands to 34% amid festive season sales

Ola Electric has dominated India’s electric two-wheeler market for the past three years, but September 2024 marked a turning point.