Ola Electric Mobility Pvt., the Indian startup that has pledged to build the world’s largest electric scooter factory, distributed a handful of brightly coloured bikes earlier this month, complete with drummers and a saxophonist to commemorate the occasion. Founder Bhavish Aggarwal came to thank the 100 customers who brought family and friends.
But, aside from the colourful proceedings, Ola isn’t living up to its lofty ambitions. According to people familiar with the company’s operations who asked not to be identified because the information isn’t public, mass production of its e-scooters is likely to be delayed until at least January.
The Bengaluru-based unicorn, which had already delayed initial deliveries from October to mid-December, is promising to fulfil the remaining orders by February. However, sources close to the company said Ola, which is backed by SoftBank Group Corp. and Tiger Global Management LLC, is struggling to iron out manufacturing kinks and can only produce up to 150 units per day – a slow pace if it is to meet the 90,000 orders Aggarwal said it had received. According to the sources, the company’s body shop is operating at half capacity, and its paint shop is not operational.
Ola Electric’s woes are a microcosm of the challenges that India’s automobile industry will face as it transitions to electric vehicles, as hampered by a global chip shortage and what analysts call an over-reliance on imported components.
They also highlight the challenges that India, the world’s third-largest emitter, may face as it strives to achieve net carbon neutrality by 2070. The ability of Ola Electric, which was recently valued at more than $5 billion in a fundraising round, to deliver on its promise will also rub off on its parent company ANI Technologies Pvt. as it prepares to woo investors ahead of a planned IPO in Mumbai next year.
