Automakers Zeekr and Neta have been identified as participants in a sales inflation scheme involving manipulation of vehicle registration and insurance data in China.
Sales Inflation and the Zero-Mileage Scheme
Reports indicate that Zeekr and Neta manipulated registration and insurance data to meet aggressive sales targets. Between January 2023 and March 2024, Neta inflated sales by at least 64,719 vehicles, over half of the claimed 117,000. Zeekr employed a similar method in 2024 in Xiamen, working with a state-owned dealer. However, local vehicle administration data revealed far fewer cars were actually registered.
Government Response and Public Backlash
Chinese financial media have expressed concern over the sharp sales spikes in specific cities, suggesting they may be artificially inflated. Zeekr confirmed that some insured vehicles were intended for showroom display but did not directly address whether these were counted as retail sales. Public opinion has increasingly criticized the practices, with official publications and dealer associations voicing their concerns.
Financial Consequences for Automakers
Shares of Geely Auto fell by 4% after the scandal broke, marking its largest single-day decline in nearly a month. Neta, facing mounting financial difficulties since 2024, has also seen a drop in sales and the subsequent bankruptcy of its parent company. Dealer associations have called for changes to sales targets and incentive programs, claiming they feel compelled to falsify sales data.
The situation with Zeekr and Neta highlights the challenges facing China's automotive industry, including market oversaturation and increasing competition. Further regulatory measures are expected to prevent such manipulations.
