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The name of Ola doesn’t need any introduction to introduce itself to anyone. The renowned fleet operating company has redefined the travelling and local transport facilities with its comfortable cars. After making its strong place in the segment, the company stepped into the business of manufacturing electric vehicles including two and four-wheelers. But unfortunately, it seems that things are not going good for the leading fleet operator.

 

 

According to reports, one of the owners of the Ola Electric S1 scooter that his two-wheeler got fire due to poor performance and irregular range. Well, this is not only the once incident of inadequate performance by an Ola scooter. There are regular reports regarding the technical issues happening with its scooter. Most of the users have tagged the Chief Executive Officer of the company Mr Bhavish Aggarwal regarding this.

 

Anyhow, whatever the situation is, it is reported that going through the increasing complaints from Ola electric scooter owners, the company had to recall 1,441 scooters for inspection and to rectify the issues related to battery, thermal, and safety measures.

 

Well, the incidents related to technical issues are not new with the vehicles. In 2008, the Tata Nano hatchback which was acclaimed as the ‘World’s Cheapest Car” had also to go through such issues in the starting days after its launch. The matter of concern is that instead of rectifying the technical issues in its scooters, the company has started working on bringing electric cars into the market.

 

In a statement made by the company, it is going to invest $100 million to set up an advanced engineering and vehicle design centre called “Futurefoundry” in the United Kingdom in the next five years. This design centre will work in hand - to - hand with its design and engineering teams located in Bengaluru. To push the endeavours Indian team, CEO Aggarwal has also moved away from Ola’s day-to-day operations to focus on an electric car, gigafactory, cell, and other logistics.

 

Commenting on Ola’s move toward electric cars, Kunal Khattar, Founding Partner, Mobility First Founders Funds, “It is important to have focus especially if you are a hardware company. It takes generations to build hardware products, especially on the auto side, so you can say that Suzuki must have been making motorcycles for God knows how many years before they upgraded to making cars. They started by making outdoor motors for motorboats. Then they used that technology know-how to make motorcycles and then they grew that capability and then they got into cars. They are still focusing on small cars.”

According to him, it looks like Ola is trying to expand its total addressable market (TAM) quickly based on its increasing reputation in the market. He added, “Prioritising valuation over everything else, which in the short term is okay. But in the long term, if you want to be a serious OEM [original equipment manufacturer] player, you want to choose either quality, design or performance”.

 

It should be remembered that Ola had shown the same type of hustle when it entered the segment of electric scooters. The company delivered its first electronic scooter immediately six months after establishing its scooter production unit. This move by the company sounds premature, but some people think that it was a timely move. 

 

Should Ola Start Working on Electric Cars? In the words of Khattar, in the light of unfortunate incidents that have happened with Ola scooters, doubting its move for electric cars is wrong. He urged that it is important to understand the reasons behind the happening of such incidents due to which they happened. In his words, “Couple of incidents like this doesn’t mean that the OEM is making sub-standard things and has taken shortcuts in quality and this and that. I think it is important to understand incidents like these happen with all manufacturers, and all fuel types. EV, petrol, diesel and CNG sab mein hota hai [happens with everyone]”.

 

He believes that calling up the scooters for rectifying the technical issues reveals the maturity level of the company and their acceptance that they are ready to fix the issues.