Softbank-backed Ola Electric has decided to suspend its electric car project and instead focus on its e-scooter business.
What Happened: Ola Electric’s founder Bhavish Aggarwal had initially planned to launch an electric sports car by 2024. The project has now been put on hold, with the company shifting its focus to the two-wheeler market, Reuters reported.
Ola’s car project could be delayed for at least two years as the company focuses on two-wheeler sales and battery production, the report suggests.
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The decision comes ahead of the firm’s planned IPO in August, where it aims to raise approximately $660 million (₹5,525 crore). The suspension of the electric car project, which could have competed with Tata Motors, highlights the challenges faced by the electric vehicle industry in India, including the lack of charging infrastructure.
Despite these challenges, e-scooters have gained popularity in India, with around 483,000 units sold by June this year. In contrast, only about 45,000 electric cars were sold during the same period a year ago.
The suspension of the project and the shift in focus to e-scooters could be a strategic move to capitalise on the growing popularity of e-scooters in India and ensure a successful IPO. The company also announced plans to cut up to 500 jobs in June to reduce operating costs ahead of its listing and focus on profitability.
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