Synopsis
Ola Electric Mobility is reportedly laying off over 1,000 employees and contract workers in its second job cut round this year, driven by rising losses and restructuring efforts.Key Takeaways
- Ola Electric lays off over 1,000 employees.
- Second round of layoffs in less than five months.
- Job cuts affect various departments including customer relations.
- Company aims to reduce operational costs.
- Significant drop in stock value since IPO.
New Delhi, March 3 (NationPress) Ola Electric Mobility is set to dismiss more than 1,000 employees and contract workers in its second wave of layoffs within a few months.
This action is a response to the company's efforts to address its increasing financial losses, supported by SoftBank Group Corporation.
The most recent job cuts span various sectors, including procurement, fulfillment, customer relations, and charging infrastructure, as reported on Monday.
This marks the second round of layoffs in under five months, following the company's decision in November to reduce its workforce by approximately 500 employees.
The current layoffs represent over a quarter of Ola's workforce, which was reported at 4,000 as of March 2024. This figure also includes contract workers who are not part of the publicly disclosed employee count.
Additionally, the report indicated that as part of a restructuring initiative, Ola Electric is automating segments of its customer relations functions.
The company is also releasing front-end sales, service, and warehouse staff from its showrooms and service centers while it revises its logistics and delivery strategy to enhance cost efficiency.
The plans for further layoffs may shift based on business needs, according to the reports.
Ola Electric has not yet released a statement regarding the latest layoffs.
Since going public in August, the EV company has encountered numerous hurdles. It recorded a 50 percent increase in losses for the December quarter (Q3) and has faced scrutiny from India’s market regulator and consumer protection agencies in recent times.
Moreover, Ola Electric’s shares have fallen by over 60 percent from their peak after the company’s IPO.
In a recent update, Ola Electric announced that it sold over 25,000 units of electric scooters in February, achieving a 28 percent market share.
However, data from the government’s VAHAN portal indicates that only one in three of the scooters sold last month was officially registered.
The company had notified investors that its vehicle registrations in February would be affected as it renegotiates terms with two of its vendors to lower costs and enhance operational efficiency.
