Ola Electric, India’s top e-scooter maker by market share, on Friday reported a narrower second-quarter loss due to a jump in sales, and said a recent increase in service requests was mainly due to “minor issues”.
The Bengaluru-based company said its consolidated loss narrowed to 4.95 billion rupees ($58.7 million) in the July-September quarter, from 5.24 billion rupees a year earlier.
Ola’s quarterly revenue rose 39.1% to Rs 12.14 billion, helped largely by sales of models priced below Rs 100,000 (about $1,186). It did not start deliveries of these models last year.
Ola Electric delivered a total of 98,619 two-wheelers between July and September, an increase of 73.6% compared to last year. Its 56,545 mass models were sold.
Expenses increased 21.8%, slower than the 26.6% increase in the previous quarter. Raw material costs, Ola’s biggest expense, rose 46.7% but were down 18.2% sequentially.
After a promising market debut in August, rising consumer complaints and regulatory scrutiny over allegations of poor service has hit the SoftBank-backed e-scooter maker.
“Not all the service requests coming in are complaints or problems with the product, many of them are routine check-ins or scheduled maintenance,” founder and chairperson Bhavish Aggarwal said on an analyst call Friday.
“Two-thirds of this is actually minor issues like loose parts or customers being unfamiliar with the software used,” Agarwal said.
Shares of Ola Electric have fallen 5.5% since its listing on August 9, even as its dominance in the electric two-wheeler market has waned in recent months.
“In the second quarter, we faced a bit of a capacity challenge on the service side, as our sales grew faster than we expanded our service network,” Agarwal said.
Reuters visited 35 Ola centers in 10 Indian states last year and found that many faced significant backlogs, with demand exceeding their workforce or supply of spare parts.
© Thomson Reuters 2024
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