Neta Auto's $25.6 Billion Loss Over Three Years Leaves State Investors Unable to Recoup Funds

[Operational Crisis] Hozon New Energy, Neta Auto's parent company, burned through RMB 18.3 billion (approximately USD 25.6 billion) in net losses over three years, leaving state-owned investments from multiple regions unrecoverable.

Key Developments: RMB 18.3 Billion Net Loss and RMB 800 Million in Wasted State Capital

From 2021 to 2023, Hozon New Energy reported cumulative net losses of RMB 18.3 billion. The State-owned Assets Supervision and Administration Commission (SASAC) and the Finance Bureau of Yichun City invested nearly RMB 2 billion via platform companies to acquire equity stakes, of which at least RMB 800 million is unlikely to be recovered. Additionally, local authorities provided irregular support measures such as constructing factories on behalf of the company, offering ten years of rent-free use, and granting a RMB 20,000 subsidy per vehicle sold.

Strategic Foundation: Aggressive Expansion and Policy Arbitrage Backfire

To attract the project, the Yichun Economic and Technological Development Zone offered numerous incentives that violated fair competition review regulations, including land grants, factory construction, and sales subsidies. The facility, covering more than 600 mu (approximately 100 acres), began production in 2021 but now sits idle and covered in dust—highlighting the unsustainability of emerging EV makers’ “scale-over-efficiency” business model.