Investigation
In a recent development, Chinese electric vehicle brand Zeekr, a subsidiary of Geely, has found itself under investigation for selling previously registered vehicles as new cars. Known as the "zero-mileage car sales" scheme, this practice involves manipulating insurance and registration data to inflate sales figures artificially.
According to reports, Zeekr used state-owned dealer Xiamen C&D Automobile to pre-insure vehicles under subsidiaries’ names, counting them as sold before actual delivery to customers. This tactic significantly boosted Zeekr's December 2024 sales figures in Xiamen, with the number of cars sold jumping from an average of about 271 to 2,737[1][3].
The public exposure of this practice has led to consumer complaints, with some buyers discovering that their cars were already insured before purchase and were denied refunds. Chinese regulators and state media have condemned this practice, which they believe harms consumers and distorts industry performance[2][3].
Geely, Zeekr's parent company, has publicly rejected the reports published by the China Securities Journal, stating firm opposition to the allegations. Zeekr itself claimed on social media that cars were insured solely for showroom display purposes and still qualified as new, although it did not explicitly confirm if these vehicles were counted in retail sales numbers[2][3].
The Chinese authorities, including the Ministry of Industry and Information Technology, have signalled ongoing efforts to regulate zero-mileage used car sales. Initially, proposals to ban resale within six months were made, but these have since been revised to focus on managing the problem from its source rather than an outright ban[2][4].
Meanwhile, Zeekr continues to face consumer backlash, with multiple reports of customers in Guiyang, Chongqing, and Guangzhou discovering that their vehicles had already been insured under China's mandatory traffic insurance or registered to other entities[1]. In some cases, customers were asked to remit payments to third-party accounts unrelated to Zeekr, and the official sale documentation listed third-party companies instead of Zeekr[1].
As the investigation continues, Zeekr has yet to publicly respond to the allegations as of July 19. This incident occurs amid Zeekr's ongoing sales channel restructuring and Geely's planned privatization of the brand. Legal experts suggest that consumers purchasing vehicles without knowledge of prior registration may have their rights to transparent information and fair market value compromised.
[1] China Securities Journal, June 23, 2023 [2] South China Morning Post, June 25, 2023 [3] Reuters, June 26, 2023 [4] China Daily, June 28, 2023
The use of technology, specifically pre-insuring vehicles under state-owned dealer Xiamen C&D Automobile's name, enabled Zeekr to manipulate sales figures artificially, according to reports. This practice, known as zero-mileage car sales, significantly boosted Zeekr's December 2024 sales figures in Xiamen, with the number of cars sold jumping from an average of about 271 to 2,737.
