Ola Electric Gets Rs 73.75 Crore Subsidy Under PLI Auto Scheme

Ola Electric Mobility Ltd. has become the first electric two-wheeler maker to get a subsidy under a scheme that promotes localisation of automotive technology in India.

On March 5, 2025, its wholly-owned subsidiary Ola Electric Technologies Pvt. Ltd. received a sanction order from the Union Ministry of Heavy Industries for release of demand incentive under the production-linked incentive scheme for automobile and auto components, the company said in an exchange filing late night on Wednesday.

A payment of Rs 73,74,36,612 has been sanctioned, the filing stated.

On September 15, 2021, the central government first approved the PLI-Auto Scheme with a budgetary outlay of Rs 25,938 crore for a period of five years to boost manufacturing of advanced automotive technology products. The aim is to promote localisation, so that India becomes a nodal link in the global supply chain. The scheme focuses on zero emission vehicles.

So far, Tata Motors Ltd. and Mahindra & Mahindra Ltd. are the only carmakers to receive subsidies under the PLI-Auto Scheme. Ola Electric now joins them as the only two-wheeler maker.

The subsidy comes as a shot in the arm for Ola Electric amid cost-cutting measures.

According to people aware of the development, Ola Electric has reportedly effected layoffs affecting 1,400-1,500 people immediately. About half of them are contractual workers hired to man the 4,000 experience centres opened in December last year.

Separately, the company has severed ties with Rosmerta Digital Services Pvt. to process vehicle registrations in-house at a fifth of the cost charged by the vendor. It is also shutting down state distribution centres which served as warehouses to supply electric vehicles to experience centres across multiple locations.

Still, there are some hiccups.

The company's Roadster X motorcycle—seen as the ticket to operational profitability—is yet to prove its roadworthiness. The manufacturing of in-house cells, which would boost margins even further, is delayed as well.

Ola Electric needs to consistently sell 50,000 units per month to achieve profitability at an operational level, Bhavish Aggarwal had said during an analyst call after the company's December-quarter earnings. The company is barely managing half of that at present.