Ola Electric has announced a workforce reduction affecting approximately 5 percent of its employees, a move the manufacturer attributes to an “ongoing structural transformation.” The company stated that the layoffs are driven by a strategy to increase automation within frontend operations and reduce overall costs. This development comes at a critical time for the electric two-wheeler manufacturer, which is currently navigating a period of declining sales and persistent scrutiny over its customer service standards.
Market Performance and Competitive Standing
The decision to downsize follows a significant shift in Ola Electric’s market position over the last year. After previously leading the electric two-wheeler segment, the company has seen its market share more than halve, dropping from 35 percent to 15.57 percent. This contraction has resulted in the brand falling to fourth place in the segment rankings.
Key performance metrics for the 2025 calendar year highlight the scale of the challenge:
- Annual sales volume decreased to 1,99,316 units, down from 4,07,700 units in 2024.
- The year-on-year sales decline represents a 51 percent drop in volume.
- Ongoing consumer complaints regarding after-sales support continue to impact brand reputation.
Operational Challenges and Service Concerns
While Ola Electric maintains that it has made progress in resolving customer service issues, the reduction in personnel raises questions about the company’s ability to manage its service network effectively. The transition toward automated frontend operations is intended to streamline the business, yet the timing remains notable given the brand’s current struggle to maintain its customer base against intensifying competition.
Future Product Development
Despite the immediate operational adjustments, Ola Electric is continuing with its stated roadmap for new product launches. The company has several high-performance and mass-market models in the pipeline, including a compact electric car and the high-end Diamondhead motorcycle. The technical objectives for the Diamondhead concept remain highly ambitious:
- Utilization of premium materials including carbon fiber, titanium, and magnesium.
- A performance target of accelerating from a standstill to 100kph in less than two seconds.
- A projected retail price in the corridor of Rs 5 lakh.
While restructuring is a common practice for companies adapting to new technologies or market conditions, the combination of a leaner workforce and a sharp decline in market dominance presents a complex path forward for the manufacturer as it attempts to regain its previous momentum.
