Ola Electric is planning to sack around 400-500 of its employees in the coming weeks, for a rather unusual reason, if some sources aware of the matter are to be believed.
According to a report by the Economic Times, Ola is preparing for a round of layoffs. The exact number of job cuts that Bhavish Aggarwal, founder-CEO of Ola Electric is planning is not set in stone yet. That is because the leadership team, which is based put of Bengaluru, is still finalising the scale of layoffs. The report suggests that the layoffs will be spread across verticals.
Why Ola Electric is planning to sack employees?
Ola Electric is planning to terminate people across the organisation to get their ballooning operating costs under control, ahead of its initial public offering (IPO), as per the report, which quoted multiple people aware of the matter as saying.
What Ola Electric plans to do next?
Sources further told ET that some of the affected employees may be replaced with new hires.
A pertinent question that arises here is why Ola is sacking employees when it may replace them with new hires.
The report mentioned that the new hiring by Ola Electric will be at a relatively cheaper cost, but the overall headcount will still decrease.
The report also claimed that three to four teams have already finalised the number of cuts as Bhavish Aggarwal has been persistently pushing to reduce costs across all avenues.
In April, Ola Cabs laid off around 200 employees. The company’s then-CEO, Hemant Bakshi, and CFO Kartik Gupta, had also resigned then. This came after Ola Electric reported a net loss of Rs 267 crore on operating revenue of Rs 1,243 crore for the first quarter of FY24.
In FY23, Ola Electric posted a net loss of Rs 1,472 crore on operating revenue of Rs 2,631 crore.
In December 2023, Ola Electric filed its draft IPO papers. It had stated that the company had 3,733 employees as of October 2023, with an employee attrition rate of 47.48 per cent in FY23.
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Ola Electric to sack about 500 people for THIS surprising reason
