Chinese electric vehicle manufacturers have allegedly exaggerated their sales figures in recent years to meet ambitious targets, as revealed through documents examined by Reuters and discussions with dealers and customers.
Documents indicate that companies are insuring vehicles before selling them, thereby allowing these cars to be recorded as sold under China’s vehicle registration rules. This strategy has reportedly helped them meet monthly and quarterly sales objectives, according to feedback from dealers and buyers.
For instance, a document shared with dealers showed that Neta reported early sales of at least 64,719 cars using this approach. This figure accounted for more than half of the 117,000 vehicles claimed over a span of 15 months.
Zeekr, a premium electric vehicle brand owned by Geely, has also implemented similar practices to boost early sales through a leading dealership in Xiamen during late 2024, based on accounts from dealers and buyers.
In the industry, cars that are recorded as sold before reaching the buyer are termed “Zero Mileage Used Cars.” This practice arose amid intense competition in the world’s largest automotive market, fueled by an ongoing price war.
Currently, there seems to be a push for accountability, with state-run media addressing the implications of this practice, leading the government to promise regulation of “irrational” competition. Central government representatives have recently met with industry leaders to express their concerns.
Over the weekend, a publication managed by the China Auto Manufacturers Association announced intentions to end this practice by prohibiting resale within six months after registration.
In addition, state-run media highlighted that Zeekr has been using pre-purchased insurance for cars to artificially inflate sales figures, marking the first public acknowledgment of such a tactic by a specific company.
Interviews conducted by a Chinese publication with Zeekr owners in cities like Guangzhou and Chongqing revealed dissatisfaction, as many felt misled and reported being denied refunds.
Questions have also been raised regarding Zeekr’s reported high sales in Shenzhen and Xiamen in December, with figures in Xiamen spiking to 2,737 — a considerable increase from previous months. However, how quickly these sales were recorded remains unclear.
The China Securities Journal has raised doubts about Neta’s sales data, and insights shared by Reuters mark a first look at how Neta may have inflated its figures.
Zeekr, along with Zhejiang Hozon New Energy, which oversees Neta, and Xiamen C&D, has not provided comments regarding these revelations. A spokesperson for Geely denied the report from the China Securities Journal but did not touch on the findings from Reuters.
Li Yanwei, an analyst with the China Automobile Dealers Association, expressed concerns about such practices being used to embellish financial reports and meet performance expectations. He advised against such methods on China’s social media platform, Weibo.
Analysts tracking the automotive sector often utilize two distinct sets of data to assess inventory levels. One set reflects sales from manufacturers to dealerships, while the other, derived from insurance registration data, provides insight into sales to end-users.
Some Zero Mileage vehicles are being exported as used cars abroad. Nevertheless, analysts assert that domestic sales greatly outnumber exports, with many customers later discovering their supposedly new vehicle lacks insurance coverage, despite appearing as a discounted purchase.
On another note, last month, the People’s Daily highlighted the detrimental effects of Zero Mileage practices on both buyers and the industry, prompting calls for more reasonable sales objectives from the four dealer associations in the prosperous Yangtze River Delta.
According to records acquired by Reuters and shared by brand dealers, Neta has been securing early sales through car insurance agreements prior to dealer transactions.
Dealers have reported needing to clarify to customers that traffic insurance is complementary and should be renewed promptly. However, some Neta buyers mentioned they were unaware of the early insurance arrangements until after their policies expired. Reports indicate that this practice began around late 2022 as the company sought electric vehicle grants.
Neta reached its peak sales in 2022, ranking as the eighth largest EV manufacturer in China with 152,000 sold vehicles. However, sales subsequently declined, tallying 87,948 vehicles in the following year, including just 1,215 in the first quarter of 2025, based on data from the Association of Automobile Manufacturers.
State media reported that the brand has faced financial struggles since late 2024, with its parent company, Zhejiang Hozon New Energy, undergoing bankruptcy proceedings last month.
Dealers associated with Neta noted that many Zero Mileage vehicles are rapidly sold off within the domestic market, and that the consensus among them is that such practices are widespread.
Zeekr, which has been privatized by Geely Auto, facilitated sales through Xiamen C&D, which manages dealerships for multiple brands. This dealership ensured the vehicles were insured and registered under several subsidiaries in December, allowing Zeekr to count these sales towards the year-end totals.
Subsequent sales to customers in cities like Beijing reportedly followed shortly after these transactions were recorded. One buyer noted that Zeekr had offered a vehicle priced 3,000 yuan lower than the dealership price while also providing a charging coupon as an incentive.
Most owners interviewed indicated that their vehicles were insured through Xiamen C&D and its affiliated companies. Data from the China Automobile Dealers Association revealed that among the 2,737 Zeekr sales recorded in Xiamen in December, 2,508 had been directed towards businesses, with only 257 going to individual buyers. In contrast, figures from Xiamen’s Vehicle Management Bureau highlighted that only 271 vehicles were registered for license plates that same month.
