China EV Brands Zeekr and Neta Inflated Sales to Meet Targets, Reuters Reports

Sales Inflation Practices in Chinese EV Market

• 💡 Zeekr and Neta, Chinese electric vehicle brands, have reportedly inflated their sales figures to meet aggressive targets.
• 📄 This practice is based on documents reviewed by Reuters and interviews with dealers and buyers.

Method of Sales Inflation

• 🚗 Both companies arranged for cars to be insured before they were sold to buyers.
• 📈 This allowed them to book sales early, adhering to Chinese car registration practices, to hit monthly and quarterly sales goals.
• ⚠️ Neta reportedly used this method for over 64,000 cars, representing more than half of their sales from January 2023 to March 2024.
• 🧐 Premium EV brand Zeekr also employed this tactic for early sales bookings in late 2024.

Industry Impact and Regulation

• 🏷️ Vehicles booked as sold before reaching a buyer are known as "zero mileage used cars" in the Chinese auto industry.
• 📉 This practice has arisen from intense competition in the world's largest auto market.
• 🗣️ State media has begun to call out the "zero mileage car" practice, and China's cabinet has pledged to regulate irrational competition.