BIS to probe e-scooter maker Ola Electric over service, product standards

New Delhi: The Central Consumer Protection Authority (CCPA)  headed by Nidhi Khare has ordered an in-depth investigation into numerous consumer complaints filed against Ola Electric, over alleged deficiencies in service standards and product quality. 

The Ministry of Consumer Affairs instructed the  Bureau of Indian Standards (BIS) to conduct a detailed investigation into the matter and submit a report in 15 days, sources in CCPA said. The directive issued on November 6, has gone to the  Director General (Investigation), who is also head of the Bureau of Indian Standards (BIS), to investigate this matter.

The regulatory body has sought a comprehensive probe following discrepancies in Ola Electric company claims on addressing consumer complaints.

Last month, CCPA sent Ola Electric a notice seeking an explanation from the  company after the consumer rights agency received over 10,000 complaints mostly on slow service and repairs and delayed deliveries. In fact, the complaints had piled up with the National Consumer Helpline (NCH) between September 2023 and August this year.

The regulator had issued a notice to Ola Electric on October 7 citing alleged violations of consumer rights, misleading advertisements and unfair trade practices. Replying to the notice on October 21, the company said it has resolved 99.1 per cent of the 10,644 complaints lodged with CCPA.

When CCPA cross-checked with a sample of consumers through NCH, it found 79 per cent were not satisfied, the source said. 

The probing authority will examine the nature of the complaints and any deficiencies in services reported against Ola Electric. Following the probe report, further action will be taken, sources said. 

The complaints were mostly for "minor" issues, Ola's founder Bhavish Aggarwal said on an earnings call last week.

"Two-thirds of it actually are just minor issues like loose parts or customers unfamiliar with the software used," Aggarwal said.

The rising complaints and ensuing regulatory scrutiny have cast a shadow on the e-scooter maker, following its stellar market debut in August.

Ola Electric's shares are down about 7.6 per cent from their listing price of Rs 76. On the day, its shares were down about 1 per cent, while auto stocks had risen 0.5 per cent.

(With agency inputs)