Ola Electric, led by Bhavish Aggarwal, will reportedly refund INR 130 Cr to customers who purchased off-board chargers separately as accessories when buying Ola S1 Pro electric scooters. According to a CNBC-TV18 report, Ola Electric decided to reimburse the amount after the Ministry of Heavy Industries (MHI) initiated an investigation against the company for overcharging customers.
The Automotive Research Association of India (ARAI) will not take any further action against Ola Electric as the company informed ARAI that they would reimburse the cost of off-board chargers to customers who purchased the accessory when buying Ola S1 Pro scooters from FY 2019-20 until March 30, 2023.
Earlier this year, Ola Electric, along with Ather Energy, TVS Motor, and Hero Motocorp, came under scrutiny for allegations of artificially keeping vehicle prices lower to claim subsidies under the Faster Adoption & Manufacturing of Electric Vehicles (FAME-II) scheme.
The scheme provides subsidies to electric two-wheelers that retail below INR 1.50 Lakh per unit. The OEMs were accused of charging customers more than the INR 1.5 lakh threshold by billing chargers and proprietary software separately for availing the subsidies.
The ongoing issues around the FAME-II subsidy have already affected the growth momentum of the nascent EV industry in India. While most OEMs saw a decline in sales volume last month, Ola Electric posted a marginal rise in its registrations. Its vehicle registrations rose a little over 2% to 21,882 units in April from 21,391 units in March.
The government has stopped releasing subsidies to Ola Electric and other EV OEMs during the investigation period, which has led to total subsidy dues of around INR 500 Cr. The Centre will release the subsidy dues after the investigation is closed. The MHI is also investigating 14 other OEMs for violating localisation norms.
While the ongoing investigation and uncertainty around the FAME policy have affected EV sales in India, Ola Electric’s decision to refund customers who bought off-board chargers separately could help restore customers’ trust in the company.
