Will Neta be able to overcome these tough times or shut down globally instead?
Neta, the electric vehicle (EV) brand under Hozon Auto, is facing significant challenges as it grapples with declining sales and internal financial troubles. The company, which was once considered a rising star in China’s electric car market, has seen its fortunes take a downturn in 2024.
Moreover, production at its Tongxiang factory in Zhejiang has been halted for half of the month, and the brand’s sales figures have been disappointing. Founded in 2018, Neta quickly gained popularity for its affordable electric vehicles like the Neta V, surpassing other major EV players such as Li Auto, Nio, and Xpeng with sales exceeding 150,000 units in 2022.
However, in a bid to move upmarket, Neta shifted focus to more expensive, technologically advanced models, including the Neta Aya, Neta S, and Neta GT. Unfortunately, this strategy has backfired, with sales consistently declining in 2024.
From January to September this year, Neta only delivered 53,853 units in China, falling short of its annual sales target by nearly 70 percent. October sales were even more dismal, with reports suggesting only around 4,500 units were delivered, down 40 percent from the previous month.
On top of that, a combination of factors contributed to this slump, including delivery delays for the Neta S Hunting wagon due to missing parts, as well as broader struggles with other models. In response to the downturn, Neta has made drastic internal changes. The company reportedly stopped production for half the month at its main Zhejiang plant, which has a planned annual output of 200,000 units.
Additionally, salary cuts have been implemented across the company, with some high-ranking employees seeing reductions of up to 30 percent. Workers also reported delays in salary payments, with the company citing cash flow issues and outstanding payments to suppliers.
Despite these struggles in the domestic market, Neta is aiming to expand internationally. The brand has entered several markets in Southeast Asia, Latin America, and South Africa, and it recently launched a plant in Thailand in November 2023. However, its plans to enter Europe may face hurdles due to EU tariffs.
While Neta faces a difficult road ahead, its innovative products, such as the Neta L crossover with advanced battery technology, continue to generate interest. Whether it can overcome these challenges and return to growth remains to be seen.
We got all this from CarNewsChina and their full article is linked here. Thank you CarNewsChina for the information and images.
