Investigations revealed that out of 3,400 Ola showrooms, just over 100 stores had trade certificates on display
India’s Motor Vehicles Act (MVA) mandates that auto showrooms should display a trade certificate. This regulation has been grossly flouted by Ola Electric leading to its stores being raided. Investigation revealed that out of the 3,400 showrooms spread across the country, only 100 such stores had trade certificates on display.
Ola Electric Stores Raided – MVA Regulations Flouted
Ola Electric, a Bengaluru based electric scooter maker, has been in the news for all the wrong reasons. Once a leader in this segment, sales have declined considerably following customer complaints with regard to service and range issues and various other factors. More recently, investigations have revealed that the company has also been flouting mandates as per Motor Vehicles Act.
Out of 3,400 showrooms, only around 100 stores had test certificates prominently displayed. This meant that over 95% of stores did not have test certification required to display, sell, offer test rides and transport unregistered electric scooters. Following these complaints, raids have been conducted and showrooms have been shut. Vehicles have been seized and a show-cause notice has been sent to the Bhavish Aggarwal led electric two wheeler manufacturer.
On further inquiry, the automaker however, has brushed aside these complaints. Though the company did not directly confirm or deny that their stores had been raided over non-conformance to MVA regulations, they did state that reports of non-compliance are ‘misplaced’ and ‘prejudiced’.
Spokespersons contend that the company does maintain an inventory of unregistered vehicles at their various stores and warehouses across the country. They also confirmed that all necessary approvals are in order and are fully compliant with the Motor Vehicles Act while they possess all required approvals.
This issue of non-compliance is not new. The first warning was sent by the transport department to Ola Electric way back in 2023. To date, nearly two dozen notices have been sent by state-level transport officials, while the recent matter was brought to the fore in March 2025 with Transport officials confirming that further investigations are underway at Ola stores with stores being raided and some of them closed.
Falling Sales, Decline Share Price
Ola Electric has suffered a steep decline in demand. Sales have plunged and share prices have plummeted by over 60% from its peak since listing in August 2024. In Feb 2025, the company sold just over 8,500 units relating to a severe YoY decline. The company also lost out on its No. 1 position in this segment, to Bajaj, TVS Motors and Ather Energy, relegated to a No. 4 spot on the government portal VAHAN since customers cannot receive unregistered vehicles.
Despite these constraints, Aggarwal states that the company could see a turn-around soon. Sales will be back on track at around 50,000 units per month. The company’s portfolio continues to include both Gen 2 and Gen 3 products with the 3rd generation S1 range that includes S1 X, S1 X+, S1 Pro, and S1 Pro+ models. The company also announced the upcoming MoveOS 5 beta release. This new update offers a range of among which are Smartwatch App, Smart Park, Bharat Mood, Road Trip Mode powered by Ola Maps, Live Location Sharing, Emergency SOS, etc.
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