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While The Parent Company In China Faces Billion-Dollar Debts And Shutdowns, The Brazilian Operation Seeks To Sell A Stock Of 800 Stalled Vehicles.
Hozon Auto, the company that controls Neta, has officially entered bankruptcy proceedings. The information was confirmed by the Chinese state broadcaster CCTV. The crisis of the Chinese automaker is the result of massive debts and production halts. In Brazil, where the brand arrived in 2024, the situation is also delicate, with low sales and a large stock of vehicles to liquidate.
Chinese Government Confirms Bankruptcy Filing For Chinese Automaker Neta
The Neta bankruptcy process gained official status last week. According to the China bankruptcy disclosure platform, a creditor filed the petition last month. The reason was an unpaid debt of 5.3 million yuan, which is equivalent to just over R$ 4 million.
However, the financial problem facing the Chinese automaker is much larger. The total debt of Neta has already reached the impressive amount of US$ 1.4 billion, or almost R$ 8 billion in direct conversion.
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Billion-Dollar Debts And Halted Production In China
The consequences of the crisis are already visible in China. Several Neta dealerships are closing their doors. There are reports of employees who took to the streets to protest for not being paid since November 2024. Dealers also demonstrated outside the brand’s factory in Tongxiang, demanding action.
The production of vehicles has been halted since February 2025. That month, only 740 units were produced, a 55% drop compared to the same period in 2024. The company expected a US$ 500 million investment that did not materialize, worsening the situation. As a result, the Chinese automaker has implemented cost-cutting measures, reducing salaries by up to 75% and leaving its former headquarters. The company is involved in over 400 legal disputes.
Low Sales And A Stock Of 800 Stalled Cars From The Chinese Automaker In Brazil
The debut of Neta in Brazil occurred in November 2024, just when the problems in China intensified. In more than seven months of operation, the brand has sold only 51 cars in the country. In May of this year, four units of the Aya model were sold and only one of the X.
After a period with social media and the official website offline, the company has reactivated its communication channels. Sources indicate that the Chinese automaker still has about 800 vehicles at the port of Cariacica (ES) that need to be sold. To do this, Neta is offering its two models, the Aya and the X, with a discount of R$ 10,000 off the list price.
What Does Neta Say About The Situation In Brazil?
Despite the adverse scenario, the Chinese automaker Neta claims that the operation in the country continues. Joseph Zhu, general manager of Neta Auto Brazil, stated that the company “is still going strong”. According to the executive, several dealers are still working with the brand and news will be communicated soon.
In an official letter, the company clarifies that it will begin a restructuring process. The statement says that the measure is an “active self-rescue action led by the” Chinese government. The main objective is to resolve the debt crisis and optimize management to ensure sustainable development.
With information from AutoEsporte.
