Recently, according to information from Tianyancha, the related company of Neta Auto, Hezhong New Energy Automobile Co., Ltd., had its 2 billion RMB equity in Zhonglian Tianxia Automobile Sales Service Co., Ltd. frozen on June 27. The freezing period is for three years, from June 27, 2025, to June 26, 2028, with the execution court being the People’s Court of Xuanwu District, Nanjing, Jiangsu Province. In fact, as early as January of this year, the 2 billion RMB equity held by Hezhong New Energy Automobile Co., Ltd. in Zhonglian Tianxia was already frozen.
Zhonglian Tianxia was established in June 2018, with Fang Yunzhu as the legal representative. Its registered capital is 2 billion RMB, fully owned by Hezhong New Energy, and its business scope mainly includes new car sales, retail and wholesale of automobile parts, etc.
Since the beginning of this year, Neta Auto’s situation has become increasingly difficult. The parent company, Hezhong New Energy Automobile Co., Ltd., had multiple equity freezing actions added last month. This includes the freezing of 1 billion RMB equity in Neta New Energy Automobile Manufacturing Co., Ltd. and 10 million RMB equity in Tongxiang Hezhong Automobile Sales Co., Ltd. The company’s founder, Fang Yunzhu, also has multiple equity freezing records, with the total amount frozen reaching 46.76 million RMB. At the same time, Neta Auto has faced several enforcement actions, including more than 30 restrictions on high consumption. In May this year, Neta Auto was fined 33,000 RMB for violating Article 6 of the “Labor Security Supervision Regulations” by refusing to rectify actions after being ordered to do so.
On June 12, Neta Auto officially announced that all employees would work from home. Shortly thereafter, reports emerged of employees surrounding founder Fang Yunzhu to demand unpaid wages. On June 19, Neta Auto was rumored to have entered a restructuring process. According to Tianyancha information, Hezhong New Energy Automobile Co., Ltd. was involved in a new case, (2025) Zhe 04 Po 3, with the applicant being Shanghai Yuxing Advertising Co., Ltd. and the respondent being Hezhong New Energy Automobile Co., Ltd., with the case being handled by the Jiaxing Intermediate People’s Court in Zhejiang Province.
From being a dark horse in the new car-making force in 2022 to now facing bankruptcy review, equity freezes, and work-from-home measures, it is hard not to feel sympathy. Neta Auto, one of the earlier car-making forces in China, initially gained attention with its slogan “Building cars for the people” and quickly opened up the mid-to-low-end market with a low-price strategy. According to related data, Neta Auto’s annual sales in 2022 reached 152,100 units, becoming the biggest dark horse of the year in the new car-making force, ranking first in the new force annual sales.
However, as competition in the new energy vehicle market has intensified, other new energy car companies have launched more competitive models, causing Neta Auto’s initial price advantage to disappear, and its sales plummeted. After 2023, Neta Auto’s sales dropped to 127,500 units, a 16.16% year-on-year decrease. In 2024, Neta Auto’s sales continued to decline, and it also became embroiled in negative issues such as unpaid wages and supplier payment delays. These negative events led to a significant drop in sales last year, with Neta Auto’s total sales for the year being just 64,500 units.
This former “dark horse” in the new energy vehicle industry now faces the fate of bankruptcy restructuring. However, even at this point, Neta Auto has not given up on self-rescue.
On June 30, Hezhong New Energy Automobile Co., Ltd. released a pre-recruitment notice for potential investors, seeking financial support and industrial resource integration to restore production and further develop. The official announcement stated that this recruitment of potential investors is mainly to accelerate the bankruptcy restructuring process of Neta Auto, effectively revitalize assets, maximize the value of debtor assets, and protect the legitimate rights and interests of all parties. The goal is to reasonably allocate resources and fully identify and leverage the operational value of the company’s assets through market-based and legal methods. Whether Neta Auto will attract potential investors remains to be seen, and time will tell.
