Amid dip in sales, Ola Electric suspends production at TN plant
Amid fears among electric scooter buyers over several incidents of e-bikes catching fire, Ola Electric recently stopped production for nearly a week at its Tamil Nadu plant, according to a report.
As per an Economic Times report citing sources, electric scooter production at Ola Electric’s ‘Future Factory’ in Krishnagiri was suspended. Ola Electric stopped the line on July 21, and its daily production was around 100 units against a current installed capacity of 600.
The company, however, said the plant was shut for annual maintenance and installation of new machines.
“Three people with information of this development said inventory pile-up was the main reason for downing tools,” the report said.
According to the report, Ola Electric has about 4,000 units of scooters piled up at the plant, and this did not include several thousands of units that are ready to be shipped to customers who have pre-ordered the scooter.
“Like most auto companies that go through annual maintenance at their factories, we did too. At no point can this be considered as shutting down production. Hence, clarifying that (information) is untrue,” an Ola spokesperson told ET Prime.
In June, Ola Electric’s two-wheeler registrations saw a further dip of more than 36% in the month and the company slipped to the fourth position, as per the government’s Vahan dashboard.
Ola Electric, which became the No. 1 company in April, saw 5,874 registrations in June. In May, it had 9,255 registrations and 12,703 in April.
“We calibrated our business priority for the month to focus on bettering our customer service and brought our TAT (turnaround time) to within 48 hours. Come July, we are confident that supply chain issues will start fading out and our strong order book will be fulfilled,” Ola Electric said in a statement last month.
Several electric scooter fire mishaps have been reported in the country which resulted in companies including Ola recalling the bikes. Ola had recalled more than 1,400 e-bikes in April.
Taking a serious note of EV fires, the Union government, in April, constituted an expert committee to probe the accidents. It said if any company is found “negligent”, heavy fines will be imposed.
Road Transport and Highways Minister Nitin Gadkari had called the EV fire mishaps “most unfortunate”.
Last year, Ola Electric CEO Bhavish Aggarwal announced ‘Mission Electric’ with a pledge “that no two wheeler will be sold in India after 2025”.
“We are taking this moment to announce ‘Mission Electric’, a pledge that no petrol two wheeler will be sold in India after 2025. This is a mission that we are putting forward to the industry and to the consumers to reject petrol and fully commit to electric. It’s time for India to lead the way in electrification and build technologies of the future, here in India for the entire world! This is certainly not going to be easy but together we can and we must. The climate needs it, the world wants it and our country definitely deserves it,” he said.