Two-wheeler electric vehicle maker Ola Electric has suspended production of its electric scooters in Tamil Nadu's Krishnagiri for roughly a week due to an inventory pile-up, within an year of its inception, reports ET Prime citing sources. It says about 4,000 scooters have been piled up at the plant, which the company calls Future Factory.
The company; however, said its manufacturing plant was shut due to an annual maintenance and installation of new machines.
"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 the publication.
Last year, Ola Electric had announced that it was setting up a 500-acre factory in Tamil Nadu's Krishnagiri, with an aim to make 10 million vehicles a year at full capacity - which would have made it the world's largest two-wheeler factory.
The company started trial production at its Future Factory plant in October last year followed by regular production that kickstarted from December last year. The company started delivering scooters from December last year.
Since then, the company has grappled with a range of problems including delayed deliveries and faulty scooters with various issues pertaining to the quality, delivery, and after-sale service of its scooters. Ola Electric also recalled 1,441 of its electric two-wheelers "as a pre-emptive measure" in April 2022, following a fire incident involving an Ola electric scooter in March 2022.
In June, Ola Electric had slipped to the fourth position in terms of electric vehicle registrations, just months after reaching the top position, as per the government's Vahan dashboard.
As per Vahan data, Ola Electric clocked around 5,874 electric vehicle (EV) registrations for June 2022, a 36.5 percent drop from 9,255 registrations in May 2022 and less than half of 12,703 registrations in April 2022, the month it became the top electric vehicle maker in the country.
To be sure, the Vahan dashboard does not capture data from Telangana, Madhya Pradesh, and Lakshadweep, due to which the number of registered EVs in these states is not available.
An Ola Electric spokesperson has also previously told Moneycontrol that Vahan is not an accurate reflection of their dispatch and sales data, since there is a "long lag in data getting updated on the dashboard" and it only captures permanent registrations.
That said, Ola Electric had attributed the decline in June to the impact of supply chain constraints, especially on cell shortage.
"We calibrated our business priority for the month to focus on bettering our customer service and bought our TAT (turnaround time) within 48 hours. Come July, we are confident that supply chain issues will start fading out and our strong order book will be fulfilled" a company spokesperson had told IANS.
However, the company has clocked only around 3,563 registrations as of July 29, as per the data from the Vahan dashboard.
These developments also come at a time when Ola Electric has witnessed several exits from its top management in recent months.
On June 25, Ola mentioned that it will also be reorienting its Ola Cars business to focus more on strengthening go to market strategy for Ola Electric. Ola Cars infra, technology, and capabilities will be repurposed towards growing Ola Electric’s sales and service network, the company said.
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