Ola Electric Faces Serious Setback as Maharashtra Orders Closure of 90% Showrooms Over Permit Violations
Ola Electric Faces Serious Setback as Maharashtra Orders Closure of 90% Showrooms Over Permit Violations
Ola Electric is facing a serious setback as the Maharashtra government has reportedly ordered the shutdown of nearly 90% of its retail outlets in the state due to widespread compliance failures. The move is expected to affect approximately 405 of Ola’s 450 showrooms in Maharashtra, raising concerns about the company’s operational standards and regulatory oversight.
The closures are being linked to the absence of valid permissions required to store electric vehicles at these locations. In addition, a large number of Ola’s showrooms are reportedly operating without the necessary trade certificates, which are mandatory for vehicle retail. These shortcomings have led to intensified scrutiny from state authorities and could severely impact Ola’s presence in one of its most critical markets.
Maharashtra has been central to Ola Electric’s business strategy, contributing over 41,000 units to its total of 3.44 lakh electric two-wheeler sales across India in FY25. The state also led the country in electric two-wheeler adoption, with 2.12 lakh units sold last fiscal year, making it a key region for any EV manufacturer. The large-scale closure of showrooms in such a vital market could disrupt supply chains and hinder customer service, dealing a blow to Ola’s ambitions.
Beyond compliance issues, Ola Electric has seen a steep decline in market share—from 33.4% in Q1 FY25 to just 19.6% in Q1 FY26. The company sold about 60,500 electric scooters in the April–June quarter, reflecting a substantial year-on-year drop. Meanwhile, competitors like TVS Motor and Bajaj Auto have overtaken Ola in monthly sales, intensifying the pressure on the once-dominant EV startup.
Earlier this year, the company also faced questions over the accuracy of its reported sales figures. Ola claimed it had sold 25,000 vehicles during a particular period, but registration data showed only 8,500 were officially recorded. The discrepancy prompted regulatory authorities to investigate further, adding to the company’s challenges.
Financial performance has also taken a hit. Ola Electric reported a consolidated net loss of ₹428 crore in Q1 FY26, up from ₹347 crore in the same quarter last year. Revenue fell sharply as well, from ₹1,644 crore in Q1 FY25 to ₹828 crore. Despite surpassing Bloomberg’s estimates of ₹735 crore in revenue and a ₹452 crore loss, the numbers reflect mounting financial pressure amid weakening sales and increased competition.
