“Nezha Motors” parent company, Hezhong New Energy, has fallen into bankruptcy reorganization, leading to over 8 billion yuan investment in Jiangxi Yichun, Guangxi Nanning, and Zhejiang Tongxiang facing the risk of irrecoverable losses.
As a former “dark horse” in the automotive industry, Nezha Motors reached an annual sales volume of 152,100 vehicles in 2022, becoming the sales champion among new automotive forces that year. According to CCTV’s program “Focus Interview,” in order to compete for this “star project,” Jiangxi Yichun, Guangxi Nanning, and Zhejiang Tongxiang have collectively invested over 8 billion yuan in Hezhong New Energy, the parent company of Nezha Motors, through various means such as equity acquisition, construction of plants, and rent reduction.
In order to facilitate the establishment of Nezha Motors, the Yichun Economic Development Zone Management Committee signed an agreement with Hezhong New Energy, with a total investment of 5 billion yuan. Local state-owned companies invested nearly 2 billion yuan in equity acquisition, and nearly 300 million yuan was spent on resolving land and plant issues. In addition, a rent reduction of up to 10 years was provided, with a 20,000 yuan incentive for each vehicle sold locally.
Nanning, Guangxi also made substantial investments, with a local state-owned platform investing approximately 2.4 billion yuan in fund form, of which Nanning Production Investment Group contributed 1.6 billion yuan, and the local government provided a special subsidy of 550 million yuan. Zhejiang Tongxiang also established its own production base. According to the prospectus, the state-owned assets commissions of Nanning, Yichun, and Tongxiang respectively hold about 11.46%, 12.18%, and 4.44% equity in Hezhong Motors.
However, the good times did not last long, as hidden problems such as inadequate investment in core technology and strategic decision-making errors began to emerge, leading to a sharp decline in sales due to blind transformation to high-end markets. Financial data disclosed in reports show that Hezhong New Energy accumulated net losses of up to 18.3 billion yuan from 2021 to 2023.
Starting in October 2024, Nezha Motors found itself caught in a whirlpool of layoffs, salary reductions, and contract payment delays, leading to a gradual halt in production lines. In the second half of 2025, Hezhong New Energy officially filed for bankruptcy reorganization.
As of now, Hezhong New Energy has only 15 million yuan in available funds on its balance sheet, while its debts total a staggering 26 billion yuan. Moreover, over 5,000 employees are owed a combined total of 460 million yuan in salaries. The total investment of over 8 billion yuan from the three regions is deeply involved and facing the harsh reality of difficult recovery.
In June 2025, the state-owned enterprise in Nanning has filed lawsuits against eight related companies of Nezha Motors.