Double trouble for Bhavish Aggarwal: Social media feud and show-cause notice add to Ola Electric’s woes

Bhavish Aggarwal, the co-founder and CEO of Ola, finds himself at the centre of a dual storm. Just hours after engaging in a public spat with comedian Kunal Kamra on X (formerly Twitter) over complaints surrounding Ola Electric’s service quality, it was revealed that his company was served a show-cause notice by the Central Consumer Protection Authority (CCPA).

The notice, reported to the Securities and Exchange Board of India (Sebi) on October 6, seeks an explanation for allegations of consumer rights violations, misleading advertisements, and unfair trade practices. Ola Electric has been given 15 days to respond.

Ola Electric, founded in 2017 to capitalise on the electric mobility boom, has faced flak earlier too. From reports of substandard quality and fire hazards to software glitches, the company’s reputation has taken a hit. As reported by Business Today earlier, the National Consumer Helpline has received over 10,000 complaints between September 2023 and August 2024 alone, reflecting widespread dissatisfaction with Ola e-scooters' service quality. And, the unofficial count is way more.

The social media feud that unfolded on October 6 further intensified the scrutiny. Kamra posted a picture of numerous Ola scooters lined up outside service centres, tagging Nitin Gadkari, the Minister of Road Transport and Highways, and questioned, “Is this how Indians will get to using EV’s? [Sic]”. His post opened the floodgates for consumer grievances, with users highlighting issues ranging from non-responsive customer support to complaints about manufacturing defects.

One user wrote, “No responses from real customer care or service centre executives, only from a chatbot.” Another cautioned against buying Ola scooters, citing “panel gaps and manufacturing defects.”

Aggarwal fired back at Kamra, accusing him of posting a “paid tweet” and taking a personal dig at the comedian’s career. “Come and help us out! I’ll even pay more than you earned for this paid tweet or from your failed comedy career. Or else sit quiet and let us focus on fixing the issues for the real customers. We’re expanding service network fast and backlogs will be cleared soon,” Aggarwal posted.

While Aggarwal’s response attempted to downplay the criticism, the fallout was evident in the stock market. Ola Electric shares plunged to their lowest level since the company’s listing in August, falling below the Rs 90 mark to Rs 89.55 on October 7, compounding the company’s troubles. On Tuesday, the stock recovered marginally to Rs 95.25 (at 2.15 pm), still a significant drop from its peak of Rs 123.90 on September 18.

This dip comes despite Aggarwal’s ambitious announcements at the company’s flagship event, Sankalp 2024, where he unveiled electric motorcycles slated to launch in 2025 and indigenously developed battery technology.

Industry experts suggest that Ola’s rapid expansion may be part of the problem. “Aggarwal’s bold promises are often overblown,” said an industry insider. “Infrastructure development and testing take time, and if a company moves too fast, issues like these are inevitable. That’s probably why their electric car plans, announced in 2022, haven’t materialised.” The expert added that start-ups are known for making tall claims, but they don’t always deliver on them.

Aggarwal’s focus on building Ola’s Giga factory and expanding its product line may have come at the cost of after-sales service quality, something the company is now grappling with. With the CCPA notice and the social media debacle, the challenges for Ola Electric and its founder are mounting, and all eyes are on how Aggarwal plans to steer the company out of this crisis.