Ola Electric’s shares experienced a nearly 3 percent drop on Monday, marking the third consecutive session of losses, following scrutiny from the Automotive Research Association of India (ARAI).
The ARAI, functioning under the Ministry of Heavy Industries, has asked Ola Electric to clarify the pricing practices of its S1 X 2 kWh electric two-wheeler, particularly concerning a recent price reduction, IANS reports.
The electric vehicle (EV) company’s stock closed at ₹87.44, a significant fall from its peak of ₹157.40. If Ola fails to provide satisfactory clarification to ARAI, it risks facing legal action and could lose eligibility for subsidies under the PM Electric DRIVE Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) scheme. The scheme is a key initiative promoting electric vehicles across India. Any violations could result in penalties in accordance with legal and subsidy guidelines.
In addition, Ola Electric, led by Bhavish Aggarwal, received a show-cause notice from the Central Consumer Protection Authority (CCPA). The notice was issued after the National Consumer Helpline (NCH) recorded over 10,000 complaints in the past year, primarily regarding poor after-sales service. Ola Electric is required to respond to the notice within 15 days.
The trouble extends beyond Ola Electric’s EV business. The Central Government has also instructed the ride-hailing arm of Ola to implement mechanisms for transparent refund processes and to issue receipts or invoices for all rides booked on its platform.
From January 1 to October 9, 2024, over 2,000 complaints have been registered against Ola, with key issues involving higher-than-displayed fares, non-refunded amounts, and incorrect driver behavior, including requests for extra cash and wrong drop-off locations.