Neta NEV brand from Hozon Auto reportedly halts production in the Zhejiang factory and cut salaries as its sales performance declined in China. The brand’s CEO Zhang Yong stopped updating its blogs on Weibo and TikTok.
Neta was founded in 2018 by Hozon Auto as a mainstream NEV maker. It produced affordable electric cars such as Neta V. This strategy allowed Neta to surpass other automakers like Li Auto, Nio, and Xpeng in 2022, with an annual volume of over 150,000 cars. At that time, Neta decided to go upmarket by launching technically advanced models with a higher price tag. Its current model line comprises six vehicles: Neta Aya (Neta V II), Neta X, Neta GT, Neta L, Neta S, and Neta S Hunting.
Neta suffers in China
However, going upmarket appeared to be quite difficult for Neta. Its sales volume continuously declined in China. From January to September 2024, Neta delivered 53,853 units domestically, reaching less than 30% of its annual sales goal. The troubled NEV maker didn’t share its October sales volume. Previously, Neta announced the previous month’s sales performance on the 1st day of the next month.
According to industry insiders, Neta delivered around 4,500 units in October, 40% down M-O-M. Several factors caused this result. First, Neta faced delivery problems with the Neta S Hunting wagon (see specs). We can tell it by a lot of comments from customers on the Neta CEO Zhang Yong Weibo. According to Chinese sources, Neta couldn’t deliver the Pro trim level of the S Hunting due to a missing accessory. Other Neta models also show poor sales performance.
The Chinese outlet DoNews reported that Neta’s Tongxiang factory in Zhejiang stopped production for half of the month. It is the brand’s main manufacturing plant with a planned production volume of 200,000 units. It mainly produced Neta L crossovers.
This year, Neta reportedly cut salaries of its employees. In October, some Neta workers claimed that the company failed to pay the previous month’s salary on time as it owed to suppliers. At the same time, the salaries of Neta’s high-ranked employees were cut by up to 30%. In an official response on October 31, Neta said it launched the full-staff equity incentive plan. It will take 5% of the shares as incentives to employees. The new salary plan was announced internally.
It is worth mentioning that previously active Neta CEO Zhang Yong remained silent on social media since October 14. His accounts on Weibo and TikTok weren’t updated for 20 days.
Neta’s parenting company Hozon Auto net losses expanded year by year in China from 2021 to 2023, with losses of 4.84 billion yuan (676 million USD), 6.67 billion yuan (930 million USD), and 6.87 billion yuan (960 million USD). As for the cash reserve, it was 2.83 billion yuan (395 million USD). In June this year, Hozon Auto submitted an application for listing to the Hong Kong Stock Exchange. It has obtained the official HK stock code. However, the previously busted WM Motor (Weltmeister) also obtained the HK stock code.
All in all, Neta suffers from slow sales in China. On the other hand, overseas sales could become the saving point for this automaker. Neta has entered several markets in Central Asia, Southeast Asia, Latin America, and South Africa. It also intended to enter Europe. However, the EU tariffs seem to affect those plans. The automaker has an overseas plant in Thailand that started operations in November 2023.
We at CarNewsChina hope Neta will live through difficult times as it offers interesting products, such as the Neta L crossover (see specs) with a CATL’s sodium-containning Freevoy battery on board.
