In the electric vehicle (EV) landscape of India, Ola Electric has positioned itself as a poster child for the “Make in India” initiative, touting rapid localization and domestic value addition (DVA) as cornerstones of its success. As of September 25, 2025—just days after the commercial rollout of its Bharat 4680 battery cells on September 22—Ola claims to have achieved 55-65% DVA across its S1 series scooters, blending in-house manufacturing with value-added assembly of imported components.

Yet, a closer examination reveals a more nuanced, if not disillusioning, picture: one where high-profile PR overshadows the reliance on foreign cores, and where localisation often equates to assembly rather than genuine innovation.

Drawing from Ola’s production data, PLI scheme certifications, and recent market performance, this article dissects the mechanics of DVA and localisation, critiques the hype surrounding self-reliance, and uncovers the bitter truths threatening Ola’s future viability.

Decoding DVA And Localisation: Ola’s Path To Compliance

Domestic Value Addition (DVA) under India’s Production Linked Incentive (PLI) scheme for automobiles and advanced chemistry cells (ACC) is a metric designed to measure the percentage of domestic content in a vehicle’s ex-factory price, encompassing materials, labor, overheads, and profits.

For Ola Electric, this has evolved dramatically since pre-2021, when DVA hovered at a negligible 0-10% due to 70-90% reliance on Completely Knocked Down (CKD) imports from China for batteries and motors. By 2023, Ola achieved the mandatory 50% DVA threshold for its S1 series (e.g., S1 Air, S1 Pro Gen 2, S1 X variants) through local assembly at its Tamil Nadu Futurefactory and strategic partnerships for cell manufacturing, climbing to 50-60% by 2024 and stabilising at 55-65% in 2025.

Localisation share, a broader term often including ecosystem contributions from co-located suppliers, has similarly progressed: assembly kits localised at 35-40% (down from 80% import dependency), with 20-30% imports persisting for rare earths and chips.

This compliance is met through a dual structure of “pure” and “hybrid” DVA.

Pure DVA, rising from 10% in 2021 to 40% by 2025, covers fully domestic in-house processes like welding vehicle frames with Indian steel, automated painting, software development for MoveOS, and labor-intensive quality testing at the 134-acre Futurefactory.

Hybrid DVA, contributing 15-25% annually, stems from adding value to imported components—such as assembling battery packs from Chinese CATL or Israeli StoreDot cells, integrating motors with local windings, or mounting imported chips on domestic PCBs.

This hybrid uplift, often 10-20% per component via labor and overheads, has been pivotal in bridging to the 50% PLI threshold since 2023, without necessitating full indigenisation.

For cells specifically, DVA attribution shifted from 0% in 2021-2022 (pure imports) to 20% in 2023 (pack assembly), 30-40% in 2024 (partial modules), and 40-50% in 2025, blending 30-40% domestic Bharat 4680 cells with 60-70% imports to manage capacity and quality during the Gigafactory’s ramp-up.

Localisation extends this by incorporating co-located partners’ value, potentially inflating figures to 70-75% when suppliers process imports locally, though PLI audits remain vehicle-centric.

Pure + Hybrid: A Simple Formula For 60%+ DVA – But At What Cost?

Ola’s model demonstrates how a straightforward combination of pure and hybrid DVA can yield 60%+ overall, making deeper localisation optional under PLI rules.

With pure elements providing a stable 40% base by 2025—bolstered by the EV Hub’s 2,000-acre ecosystem in Tamil Nadu—and hybrid additions from imported cells, motors, and electronics delivering 15-25% through assembly, totals of 55-65% are routinely achieved.

This has unlocked incentives like ₹73.74 crore in March 2025 and over ₹2,000 crore collectively, with certifications for models like the S1 Pro Gen 2 (51.84% DVA) and Roadster X+. Up to September 2025, this formula sustained operations amid Gigafactory delays (from Q1 2025 target to September 22 rollout), where blending ensured supply without halting production.

Yet, this efficiency exposes the farce in excessive “Make in India” PR. Ola’s narrative of self-reliance—amplified through events like Sankalp 2025, showcasing AI scooters and festive price cuts—masks how 65% DVA is often “managed” via low-hanging fruits: local labor and processes and basic processes on foreign imports, rather than groundbreaking R&D.

Critics argue this is “screwdriver technology” at scale, where hype around vertical integration (e.g., co-located suppliers) overshadows persistent import dependencies for 40-50% of value, including rare earth magnets and semiconductors.

Ola’s opposition to import duty cuts on motors in 2025, while importing magnets and assembling domestically, underscores protectionism for hybrid models, not true innovation. As a researcher sifting through the cracks, the bitter truth emerges: such PR inflates nationalistic sentiment but delivers marginal economic multiplier effects, with value leaking abroad via royalties and imports.

Post-2021 India: An Assembly-Line Economy Masquerading As Manufacturing

Since 2021, India’s EV ecosystem, including Ola’s, has pivoted to assembly of core foreign materials rather than holistic local manufacturing, a systemic flaw rooted in PLI’s phased incentives. Ola’s acquisition of Dutch Etergo in 2020 for its Appscooter prototype, partnerships with CATL and LG Chem, and initial CKD-heavy approach exemplify this: chips, motors, and cells—comprising 50-60% of BOM—are imported, then “localised” via Tamil Nadu assembly lines with 148 robots for welding and integration.

The Gigafactory, operational since March 2024 at 1.4 GWh (expanding to 6.4 GWh by April 2025), marks progress, but blending with imports persists due to demand (300,000+ units annually) outpacing domestic output, quality teething issues, and cost hedges. This “assembly-first” model, while PLI-compliant (25% ACC DVA initially, scaling to 60%), critiques reveal it’s a shortcut: hostile work cultures, safety defects (e.g., front fork recalls in 2023), and manufacturing complaints (10,664 in 2024) stem from rushed pivots and CEO-driven deadlines, not mature indigenisation.

In essence, post-2021 India builds EVs on foreign tech foundations, with localisation as a veneer—Ola’s plagiarism scandals and misleading claims (e.g., “world’s largest E2W maker excluding China”) further erode credibility.

Future Trends And The Precipice Of Collapse

Looking ahead, Ola targets 60%+ DVA by 2026 via Gigafactory scaling to 20 GWh, rare earth-free ferrite motors, and full Bharat 4680 integration, potentially reducing hybrids to 10-15% and pushing localisation toward 70-80%.

However, trends signal peril: market share has plummeted from 35% in 2024 to 25.5% in FY25 and 19.6% in Q1 FY26, eroded by TVS and Bajaj’s dealer networks and customer trust. Sales halved in H1 2025 (115,000 units), losses widened to -₹2,357 crore, and stock has cratered 75% since the 2024 IPO, with a $5 billion wipeout prompting SoftBank’s stake cut to 15.68% and promoter share pledges

If this trajectory continues—amid sinking sales, high attrition, and service woes—the bitter truth is closure or cessation of Indian cell production looms. The costly Gigafactory, already delayed and penalty-risked, could become unsustainable without profitability (targeted FY26), potentially stalling India’s EV ambitions and exposing the fragility of assembly-dependent models.

In conclusion, Ola Electric’s DVA saga illuminates a broader irony in India’s post-2021 EV push: while pure-hybrid combos enable 60%+ localisation on paper, the reality is an import-reliant assembly line, propped by subsidies and PR. The cracks reveal not innovation, but vulnerability—unless addressed, Ola’s story may end as a cautionary tale of hype over substance.