Chinese electric vehicle maker Neta is facing a backlash in Thailand, as the restructuring of its parent company has caused difficulties supplying parts to the country and paying suppliers, resulting in the price of some new cars being slashed by half.
Furthermore, the company has fallen behind in local production requirements for subsidies. These troubles could force the Thai government to change course on its EV policy.
On an early July visit to Bangkok’s Srinakarin Road, which is lined with car dealerships, Neta’s dealership was deserted. Though the store was technically open, most of the lights and the air conditioning were off.
After waiting in the dark showroom for ten minutes, a man in a T-shirt appeared and began explaining the startup’s vehicles, saying that it probably sells the cheapest EVs in Bangkok.
The Neta V-II small hatchback was selling for THB 280,000 (USD 8,700), despite having a list price of THB 569,000 (USD 17,680). The salesperson said Chinese headquarters had asked them to lower prices the previous week. He added that he could lower the price even further if several vehicles were bought at once, pointing to the dealership’s stock of over 600 vehicles.
Hozon New Energy Automobile, Neta’s parent company, said on social media in early June that its restructuring process will not affect its business in other countries, including Thailand.
Hozon is undergoing legal reorganization with the aim of restructuring in mainland China. The company said Neta will continue to invest in the Thai market and proceed with parts supply and software updates as usual.
“Neta’s announcements are all big lies,” said a self-employed 30-year-old man who spoke to Nikkei on July 14. He bought a Neta V-I in 2021 for THB 549,000 (USD 17,060) to escape rising fuel prices. His car is usable for now, but he faces the risk of replacement parts not arriving from China. He said it is unfair that he has to continue making monthly loan payments despite the company’s inadequate response to the situation.
In Thailand, there have been many cases where the company fails to uphold a vehicle’s warranty and people are unable to use their vehicles because they cannot receive after-sales service.
Affected consumers have already submitted a petition to some Thai lawmakers and are poised to file a class action lawsuit. The movement has developed into a political concern, with a Thai Senate commerce and industry committee issuing a statement saying it recognizes the problem as a major issue and will work with the government and the private sector to address it.
Neta has outsourced the assembly of finished vehicles to local companies around Bangkok since 2024, but appears to have gotten behind in payments to parts manufacturers since the beginning of this year. An automaker failing to pay is unprecedented, one local supplier told Nikkei.
The situation could create ripple effects throughout the Thai automotive industry. Thailand introduced subsidies for purchasing EVs in 2022, a first for Southeast Asia. With the goal of making 30% of the vehicles produced annually in the country EVs by 2030, purchase subsidies of THB 150,000 (USD 4,660) per vehicle were paid through 2023 before being reduced to THB 100,000 (USD 3,110) in 2024.
The subsidies are not paid directly to consumers, but rather to automakers after a certain period of time. Neta sold about 12,800 vehicles in Thailand in 2023 and 7,900 vehicles in 2024, which means it likely received a total of about THB 2.7 billion (USD 83.9 million).
But Neta appears to be falling short of the subsidy requirement of producing its EVs in Thailand from 2024. The company needed to produce 13,000 vehicles in Thailand in 2024 and 19,000 in 2025 in order to meet the requirements, but according to local reports, has only produced a few thousand.
Other Chinese automakers have also experienced turbulence in Thailand. Since the second half of 2024, Chinese automakers have been asking the Thai government to relax the domestic production quotas required for subsidies.
“We came because we were invited by the Thai government, but sales here have been sluggish due to the high household debt ratio, so [the market environment] is not what we expected,” an executive at one automaker told Nikkei.
Bangkok agreed to relax the domestic production quotas in December 2024, but said it would stop providing subsidies until those quotas are met—a move believed to target several companies, including Neta.
China’s Great Wall Motor and SAIC unit MG Motor have not increased the utilization rates at their Thai plants. BYD is the only Chinese automaker that can properly produce EVs in Thailand, one local supplier said.
“Some Chinese automakers other than Neta have the backing of the government, so their risk of bankruptcy is low,” said Hajime Yamamoto of Nomura Research Institute Thailand. “A committee will be launched at the end of July that could hand down some decisions on obligations for reporting production plans and progress, as well as clarify the progress of domestic parts production and decide punitive measures.”
The Thai government, which has until now been all-in on EVs, has begun to revise its stance on them this year. Bangkok and Tokyo held talks on energy and industry in the Thai capital, where the two governments discussed the next-generation automotive industry.
The Thai side emphasized the importance of a multi-pathway strategy that pursues various options for decarbonization, including hybrids and other electrified vehicles—the same strategy advocated by Japanese automakers.
“Neta’s financial issues will upset consumers and lead to a move away from Chinese autos,” said a Japanese government source in Thailand.
Still, Yamamoto feels that “the situation is unlikely to bring about any big policy changes with regard to the goal of getting EVs to account for 30% of all automotive production by 2030.”
This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.