A rising controversy has emerged in China’s automotive sector over so-called “zero-kilometre used vehicles”—autos which were registered however by no means pushed, now flooding the second-hand market. Trade voices like Nice Wall Motor Chairman Wei Jianjun are talking out, and this follow is drawing criticism for distorting gross sales information, deceptive customers and undermining long-term market stability.
The hidden story behind clear numbers
The core of the “zero-kilometre used automobile” phenomenon lies in a course of the place new autos are registered as bought, usually to affiliated sellers or third-party platforms, after which resold as used vehicles regardless of having little to no mileage. This manoeuvre serves a number of functions: serving to automakers hit gross sales targets, enabling sellers to dump unsold inventory, and, in some instances, profiting from subsidies or export insurance policies tied to automobile registration standing.
Analysts level out that this follow is intently linked to systemic challenges within the business. Overcapacity stays a urgent problem, with nationwide passenger automobile stock reaching 3.5 million items in April 2025. Some producers function at lower than 50% capability utilisation, prompting aggressive ways to alleviate stock strain. Moreover, intense value wars and a reliance on authorities subsidies, notably within the new vitality automobile (NEV) sector, have created situations ripe for such opaque gross sales methods.
Client dangers
Whereas these autos are sometimes priced attractively — typically 30% under the unique MSRP — they carry important hidden dangers. Warranties often start at registration, which means patrons might lose months of protection. Some fashions additionally include unpaid loans or unclear possession histories, exposing customers to potential authorized and monetary points.
Market analysts warn that the long-term penalties transcend particular person transactions. Artificially inflated gross sales information can mislead traders, obscure market demand, and deform competitors. For example, second-hand costs for fashions just like the BYD Qin L have plunged 30-40% under their official listing costs, triggering a domino impact throughout competing fashions and contributing to a broader collapse in value expectations.
Regulatory consideration and business response
In response to the rising concern, China’s Ministry of Commerce held a high-level assembly on Could 27 with key gamers, together with BYD, Dongfeng, and used automobile platform Guazi. The discussions centred on tightening oversight of used automobile transactions and cracking down on fraudulent gross sales reporting. Officers are reportedly contemplating frameworks just like the U.S. Securities and Change Fee’s method to “channel stuffing,” a monetary manipulation tactic the place firms overstate income by pushing extra inventory into distribution channels.
Trade consultants advocate for a shift away from short-term ways. Really helpful methods embrace rebalancing manufacturing planning, enhancing transparency in automobile histories and warranties, and increasing regulated second-hand automobile exports to abroad markets resembling Russia to alleviate home strain.
Learn how to spot a zero-kilometre used automobile
Customers are suggested to scrutinise listings marked as “virtually new” and examine them in opposition to official pricing to keep away from being caught off guard. A steep low cost of over 30% may point out that the automobile is a zero-kilometre used automobile. Patrons ought to use automobile identification numbers (VINs) to confirm registration dates, service information, and insurance coverage claims. Choosing respected sellers, demanding written guarantee agreements, and guaranteeing all monetary obligations on the automobile are cleared are additionally important steps.
When value variations are marginal — under 15% — consultants advocate sticking with new autos to retain guarantee protection and peace of thoughts. Nevertheless, in instances the place steep reductions outweigh the lack of advantages, patrons should tread fastidiously and weigh the trade-offs.
The larger image
Though some argue that the rise of zero-kilometre used vehicles is a pure market response to oversupply, many within the business see it as a harmful shortcut. Wei Jianjun and others have referred to as for a return to fundamentals: innovation, product high quality, and client belief. With out systemic reform, reliance on these ways dangers eroding model fairness and fueling a cycle of value erosion and mistrust.
Because the business undergoes a painful transition marked by restructuring and coverage tightening, the zero-kilometre used automobile mannequin’s future will hinge on regulatory motion and company self-restraint. For now, the burden of warning falls closely on the patron.
