Bengaluru-based electric vehicle startup Ola Electric faced a significant setback as its shares tumbled over 9% on October 7, 2024. This sharp decline comes in the wake of a public controversy involving the company’s founder and CEO, Bhavish Aggarwal, and stand-up comedian Kunal Kamra. The dispute has brought to light ongoing customer service issues plaguing the EV manufacturer.
Key Developments in the Ola Electric Controversy
- Social Media Showdown On Sunday, October 6, Kunal Kamra shared a photo on X (formerly Twitter) showing numerous Ola electric scooters parked outside a dealership, apparently awaiting service. This sparked a heated exchange between Kamra and Bhavish Aggarwal.
- CEO’s Controversial Response Aggarwal accused Kamra of accepting payment for criticizing Ola Electric, dismissing the comedian’s concerns and insulting his career. This response drew further criticism from social media users and customers.
- Customer Complaints Flood In The public spat opened the floodgates for dissatisfied Ola Electric customers to voice their grievances about poor after-sales service and product quality issues.
- Market Impact As a result of the controversy, Ola Electric’s stock price plummeted to INR 89.71, marking a 9% decline in early trading hours on October 7.
- Declining Market Share The incident highlights Ola’s ongoing struggles in the EV market. The company’s escooter registrations dropped 11% month-on-month to 23,965 units in September, while its market share dipped from over 30% to 27%.
Addressing Customer Service Issues
In response to mounting criticism, Ola Electric has taken steps to improve its service:
- HyperService Initiative The company recently launched “HyperService,” promising one-day resolution for service-related issues.
- Expanding Service Network Aggarwal claims that Ola is rapidly expanding its service network to clear backlogs.
Industry Implications
This controversy raises important questions about the growth of the EV industry in India:
- Customer Trust: The incident underscores the importance of after-sales service in building and maintaining customer trust in the EV sector.
- Startup Challenges: It highlights the difficulties faced by rapidly growing startups in scaling their operations while maintaining quality service.
- Social Media Impact; The power of social media in shaping public perception and influencing stock prices is evident in this case.
Conclusion:
The Ola Electric controversy serves as a wake-up call for EV startups in India. As the industry grows, companies must prioritize customer service and quality control to maintain market share and investor confidence. The incident also emphasizes the need for thoughtful communication strategies in the age of social media, where public disputes can have immediate and significant financial consequences
