Neta Auto Begins Bankruptcy Reorganization After Employees Demand Unpaid Wages

Neta Auto, once a rising star in China’s electric vehicle (EV) industry, is now facing a major crisis. Reports indicate the company will officially begin bankruptcy reorganization proceedings on June 12, 2025.

This development came after a video circulated online on June 11, showing a large group of employees gathering at the company’s new office in Shanghai to demand overdue wages. The employees confronted Chairman Fang Yunzhou in person. According to those present, over 100 people joined the protest, but the only response they received was a directive to wait for the company’s liquidation process under court supervision.

In the video, a company employee confirmed that Neta Auto would enter bankruptcy reorganization the next day—a statement later corroborated by several others. This situation reflects deep-rooted issues the company has faced over the years, including cash flow shortages, the departure of executives, and growing pressure from suppliers.

Since 2024, Neta Auto has faced multiple lawsuits due to capital shortages and debt defaults. Many employees claim they have not been paid since November 2024, around the time the company laid off over 2,900 staff—nearly half of its total workforce. Although the courts have issued orders for unpaid wages to be settled, many employees have yet to receive any payment, as the company reportedly lacks sufficient assets to seize. For example, in March 2025, court orders froze less than 500 yuan (about 2,000 baht) in total across two affiliated company accounts.

On May 13, 2025, Shanghai Yuxing Advertising Co., Ltd. filed a petition with the court requesting a bankruptcy review of Hozon New Energy, Neta Auto’s parent company. The advertising firm claims that Neta Auto owes over 5.31 million yuan (approximately 740,000 USD) in unpaid service fees and failed to comply with a repayment agreement. Neta Auto, however, responded by stating this was a unilateral action by a supplier and emphasized that the company had not officially entered bankruptcy proceedings, with internal operations still ongoing.

Neta Auto was once a prominent player in China’s new-generation EV market, with sales reaching 152,000 units in 2022. However, sales dropped to 127,500 units in 2023 and plummeted further to just 64,500 units in 2024. By January 2025, the company delivered only 110 units domestically—effectively pushing it out of the mainstream EV market in China.

Source: CarNewsChina