December 2, 2021

The World Stock Markets Tips & Targets, News, Views & Updates

The World Stock Markets Tips & Targets, News, Views & Updates

Ola to delay delivery of first batch of scooters, blames chip shortage

Ola Electric will move the delivery for the first batch of its electric scooters from December 15 to December 31, delaying the schedule by two to four weeks due a shortage of chipsets and electronic parts. All deliveries for the first batch of orders were expected by November 30.

The company took the decision after a meeting between its factory team and the global supply chain on Saturday reckoned the delivery of chips and electronic parts was only “getting worse”, sources told Business Standard.

Ola, in a communication to customers, apologised for the delay and said it is “ramping up production as fast as we can so that you can get your Ola S1 at the earliest”.

The chip shortage has hit vehicle manufacturers across the globe. Qualcomm has a tie up to provide Ola Electric with the key 4G-connected octa core android platform that provides connectivity, computing capabilities. Qualcomm gets its chips manufactured by other third party players.

Qualcomm India president Rajen Vagadia, in an interview to Business Standard late last month, had said (not specific to any company) that while his company is making all efforts to bring some normalization by April 2022, some industries like automobiles might be plagued a little longer and might have to do a bit more of catching up. The dependence on chips in powering an electric vehicle can be guaged from the fact that industry estimates that a two-wheeler requires about 15-20 micro chips and sensors while cars the number could go up from 150- 200.

“Yes there is a problem and the situation is evolving. But I think we are better off than others because we had planned for the shortage. So the impact is not that pronounced,” said Varun Dubey, Ola Electric chief marketing officer, when asked about the chip shortage a few days ago.

Ola started bookings from September 15 and announced it had done sales worth of Rs 600 crore in the first day, hitting Rs 1100 crore in the second day. And while test rides for customers who have booked has begun, deliveries are still awaited.

Ola is of course is not the only player facing the chip shortage. Tarun Mehta, co founder of Ather Energy, another maker of EV scooters, has said before that the delivery schedule of some chips had increased nearly ten times.

“The delivery time for these were earlier 3-4 weeks now it is 36-38 weeks. For growth players like us it is a big constraint. ” Mehta said that in November.

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