Ola Electric in Hot Seat: State Orders Mass Closures, Company Denies Notice

Image Source: Business Standard

Ola Electric Mobility Ltd said it does not have any information on a formal notice to shut 100 of its showrooms in Maharashtra, even as state government agencies step up action against units functioning without proper trade certificates. The Maharashtra Transport Department recently began a massive crackdown, instructing regional transport offices to close down Ola Electric showrooms and service centers without the required trade certificate under the Motor Vehicles Act.

Key Highlights:

Maharashtra RTO inspections have found that of 146 Ola Electric stores inspected, 121 were found to be running without valid trade certificates. Consequently, 75 showrooms have already been closed down, and 192 vehicles have been impounded during enforcement drives.
The joint commissioner of transport for the state wrote on April 16 ordering prompt closure of non-compliant outlets and revocation of their trade certificates, with RTOs having only one day to fall in line and report back.
Ola Electric, though, has denied the allegations in public, terming reports of widespread closures as "speculative, incorrect, and misplaced." The company states that it is cooperating closely with the authorities to address any issues and is in the process of applying for trade certificates for all its Maharashtra outlets.
The crackdown comes after previous investigations by the Ministry of Heavy Industries and Ministry of Road Transport and Highways on compliance and registration irregularities at Ola Electric showrooms.

This regulatory move would go a long way in hampering Ola Electric's retail and service business in Maharashtra unless the compliance problems are addressed immediately.

Sources: Economic Times, NDTV, News18, Financial Express, Rushlane, Zigwheels