Recently, a serious scandal has been exposed in the Chinese electric vehicle market, involving two major brands, Nezha Motors and Jiuke Motors. These automakers have been accused of inflating sales figures by selling “zero-kilometer used cars” as new vehicles. This not only harms consumer rights but also raises concerns about financial fraud and irregularities in the industry driven by fierce market competition.
According to a report by Reuters, in recent years, Chinese electric vehicle brands Nezha and Jiuke have resorted to massive overreporting of sales figures by prematurely insuring vehicles to meet sales targets. Documents from the investigation reveal that Nezha Motors, between January 2023 and March 2024, confirmed the sale of at least 64,719 vehicles through this method, exceeding more than half of their reported sales during the same period. Jiuke Motors similarly employed similar tactics through its dealers in the Xiamen region.
These vehicles were confirmed as sold before actually being delivered, known in the industry as “zero-kilometer used cars.” This practice stems from the intense competitive environment in the Chinese automotive market and the pressure from overcapacity leading to price wars.
Dealers and buyers have reported instances where they unknowingly received vehicles that were already insured, only realizing the issue when insurance coverage took effect prematurely. Buyers of Nezha Motors expressed that dealers never disclosed the insurance status beforehand, while Jiuke Motors’ customers were misled into purchasing what they thought were new cars but turned out to be used vehicles.
Meanwhile, state media in China has begun to criticize such practices, explicitly naming Jiuke Motors for inflating sales figures for the first time.
According to a report by China Securities News on July 18th, Jiuke Motors sold inventory vehicles that were already insured or had undergone ownership transfer as new cars through its direct stores, sparking mass consumer complaints in multiple regions.
In a case in Guizhou, car owner Cai Jian paid 50,000 yuan to purchase a 2025 Jiuke 001, only to discover it was a stock vehicle produced in December 2024. Initially refusing to replace the car, the seller eventually did so under pressure from complaints.
In a case in Chongqing, car owner Cheng Cheng had pre-ordered a Jiuke 007 at a Jiuke direct store, but the contracting entity turned out to be Xiamen Aohan Automotive Co.,Ltd. The vehicle had already been insured, with sales personnel intentionally withholding information and refusing to refund the deposit.
In a case in Guangzhou, car owner Li Xing found that the purchasing platform was fabricated, with the contracting entity being Xiamen Ouxing Automotive Co., Ltd., which had insured the vehicle under compulsory insurance back in December 2024, making its legal status that of a used car.
Consumers have widely reported that Jiuke sales personnel would use tactics like “limited-time discounts” to mask the true nature of the vehicles, leading to difficulties in seeking justice after purchase. Several car owners have formed rights protection groups, numbering over 80 individuals across various regions, indicating that this issue is not isolated.
Data from China Securities News indicate that Jiuke Motors’ sales volume in December 2024 reached 29,200 units, marking a record high for the year. Industry expert Li Yanwei pointed out that such abnormal sales figures are likely directly related to the operation of “zero-kilometer used cars,” where automakers inflate sales figures through bulk sales to third-party companies to embellish financial statements.
This phenomenon is not unique to Jiuke Motors. Reportedly, Nezha Motors’ corporate sales accounted for as high as 63% in 2023, far exceeding the industry average of 11.3%. In some cities like Xingtai, the corporate sales ratio surged to a surprising 95.3%, raising serious doubts within the industry regarding the authenticity of their sales figures.
Insiders have disclosed that automakers, in a bid to boost sales numbers and alleviate stock pressure, extensively rely on “zero-kilometer used cars” to recognize revenue in advance, severely misleading capital markets in assessing the actual supply-demand relationship.
On July 20th, Jiuke issued a statement on its official Weibo account responding to the controversy, claiming that the “zero-kilometer used cars” reported by the media were display vehicles that could be legitimately sold, as they were insured but not registered, thus still constituting brand-new vehicles legally.
However, consumers widely contested this response. According to a report by Hongxing Capital Station, car owner Miss Chen unequivocally stated that sales personnel never disclosed in advance the insurance status of the vehicles or the third-party contracting situations. Most importantly, the contracting entity, Xiamen Ouxing, is a subsidiary of Jianfa Automotive, not directly linked to Jiuke Motors. Consumers question whether these are indeed “third-party vehicles” rather than so-called display cars.
“Zero-kilometer used cars” refer to vehicles that have been registered but not actually driven, with mileage close to zero, usually sold through used car channels at discounted prices.
According to the latest data from China Automobile Dealers Association, the nationwide volume of used car transactions in 2024 reached 19.6142 million units, up by 6.52% year-on-year. Among these, “zero-kilometer used cars” for traditional fuel vehicles account for 1% to 3% of the used car market, while the proportion for new energy vehicles reaches as high as 3% to 5%.
Following public criticisms by Wei Jianjun, Chairman of Great Wall Motors, the industry’s hidden practices have gradually come to light. Insiders estimate that by 2025, the number of “zero-kilometer used cars” in China could potentially reach up to a million units, a deeply alarming situation.
Of particular concern, Economic Observer cited sources from relevant associations revealing that over 90% of China’s exported new energy used cars are “zero-kilometer used cars.”
Professor Xie Tian from the Moore School of Business at the University of South Carolina previously told Epoch Times that China’s automotive industry’s “zero-kilometer used cars” have become a “cancer” and an unwritten rule, even resorting to deception to enter the European market. Chinese electric vehicle companies, unable to meet Europe’s stringent safety standards, disguise new cars as “used vehicles” for export to evade inspection. He emphasizes that Chinese electric vehicles are not of good quality, and even at lower prices, they are not worth purchasing, highlighting integrity and quality issues in the industry.