NETA’s EV Dream Derails - What It’s Bankruptcy Means for Malaysian

The future of NETA is hanging by a thread after its parent company, Zhejiang Hozon New Energy Automobile, filed for bankruptcy in China. Chinese state broadcaster CCTV reported on June 19 that the filing followed a lawsuit over an unpaid debt of RMB5.3 Million (RM3.4 Million), with total liabilities exceeding RMB10 Billion (RM6.4 Billion).

The situation in China appears increasingly unstable. Several showrooms have already closed, and hundreds of employees have reportedly taken to the streets in protest after going unpaid since November 2024.

The collapse of the company, once regarded as a rising EV star, has sent shockwaves through its overseas operations too.

In Thailand, signs of trouble had emerged well before the bankruptcy. NETA Auto Thailand has been grappling with service-related issues, especially a shortage of spare parts.

According to the Bangkok Post, this has resulted in lengthy delays for repairs and insurance claims, with some cases taking up to 10 months to resolve.

Adding to concerns, the dealer network is shrinking. The number of NETA showrooms in Thailand has dropped from 60 to just 40, with more closures expected as dealers face mounting financial losses and liquidity problems.

In an attempt to ease concerns, NETA Auto Thailand general manager Sun Baolong announced on June 12 that the parent company was undergoing debt and organizational restructuring.

He assured customers that “as long as NETA remains in China, NETA will stay in Thailand.” However, that statement now seems increasingly uncertain in light of the bankruptcy news.

On social media, NETA Thailand has issued warnings to customers not to buy discounted vehicles from dealers, stating that such units will not be covered by warranty. This move has reinforced the perception that dealers are rushing to offload unsold stock amid fears of collapse.

At the same time, NETA Thailand has been sharing images of a stocked parts warehouse to rebuild confidence and show it is taking steps to support existing owners.

Still, it's unclear if these efforts are enough to calm growing public anxiety, especially with the brand’s reputation taking a hit.

In Malaysia, the outlook appears equally bleak. Buyer confidence has plummeted, and the brand is reportedly slashing prices to clear existing inventory. In a recent announcement, NETA Malaysia revealed it is restructuring its operations and shifting to a direct-to-consumer model, likely a response to sales agents pulling out, as both the NETA V and X have become increasingly difficult to move off showroom floors.

Additionally, in a surprising move, NETA Malaysia has been reposting updates from NETA Thailand’s spare parts availability in a bid to reassure local customers. The belief is that, should Hozon’s operations falter, support could be sourced from Thailand. But this raises several concerns.

For one, NETA Thailand has not confirmed any official support arrangement for Malaysia. And with far more NETA vehicles on the road in Thailand, it’s uncertain whether available parts would be sufficient for both markets if demand surges.

To date, NETA Malaysia has not issued a clear statement on how it plans to protect its customers in the event of a prolonged disruption, let's not forget its long overdue CKD program.

Given the circumstances, The Bangkok Post advises consumers to monitor the situation closely and weigh their options carefully, and the same caution should certainly apply to buyers in Malaysia.

The promise of affordable electric mobility now comes with rising risks—and increasingly uncertain support.