Ola Electric on Wednesday announced that it has successfully completed the initiative initiated to reduce the cost of the company and improve customer experience.
The company launched the ‘Network Carry and Cost Cost Program’ in November 2024, which has now been fully implemented.
However, despite this news, Ola Electric shares saw a slight decline, and they closed at Rs 50.78.
How much did the company benefit from the initiative?
According to Ola Electric, this initiative has cut the cost of the company permanent Rs 90 crore per month.
- Its entire financial impact will start appearing from April 2025.
- The company hopes that by the first quarter of FY 2025, it will achieve the ‘Nafa, no disadvantage’ position (Ebitda Break-Even).
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What was the change in the company’s network reform?
Ola Electric has made several significant changes under its cost savings scheme, including:
- Closing warehouses and carrying vehicles – Now the stores are being sent directly from the factory to the store, causing a huge reduction in the cost.
- Registration and automation of other procedures – This reduced administrative expenses and improved customer experience.
- Improvement in productivity of sales and service networks – Now rapid work is being done in both sales and service sectors.
- The delivery time of vehicles was reduced-earlier where it took 12 days for delivery, now the customer is getting a vehicle in just 3-4 days.
- Improvement in stock management – The average vehicle stock has come down from 35 days to only 20 days.
What will be the future of Ola Electric?
- From April 2025, the company’s financial situation will see improvement.
- The company is moving towards becoming profitable in the next financial year.
- Customers will get better experience by rapid delivery and cost cuts.
