- Chinese automakers are inflating their sales numbers by selling new cars as used ones.
- Most of the country’s 2024 used car exports reportedly had zero recorded mileage.
- Auto executives and party officials are split over the long-term impact of this tactic.
A new report claims that China’s auto industry is inflating its sales figures and skirting global trade norms by selling new vehicles abroad as zero-mileage “used” cars. Local governments eager to hit Beijing’s economic targets seem to support the practice, while the CCP condemns it.
This strategy allows Chinese automakers to register sales, clear domestic inventory, and sidestep trade barriers all at once. Forget issues with selling new cars to places like Russia, Central Asia, and the Middle East; exporting them as “used” solves the issue.
“This is the outcome of an almost-four-year price war that has made companies desperate to book any sales possible,” said Tu Le, Michigan-based founder of consultancy Sino Auto Insights.
More: Chinese Dealers Sell Zero-Mileage Cars As Used To Cash In On Subsidies
That quote and more like it come from an extensive Reuters report detailing the operation. While the practice has been going on for years, it wasn’t until May 2025 that a Chinese auto executive, Wei Jianjun, complained about it publicly. Why complain about something that seems to be as good as a license to print money? Well, according to Jianjun, the situation could potentially lead to a crisis within the industry.
A Win-Win Situation For Everyone Involved
Right now, exporters are buying new cars from automakers or dealers. Then, they register them in China, but immediately mark them as used before shipping them out of the country. The automaker gets to count the sales. The exporter gets a big benefit too.
“Because these export firms both purchase and sell a single car, the transaction value is double that of new or used-car purchases, so local governments court them to set up shop on their turf to quickly and artificially boost their GDP statistics, two Chinese auto industry executives said,” Reuters explains.
“Of the 436,000 used passenger and commercial vehicles exported by China in 2024, 90% are estimated to be ‘zero-mileage’”, says Wang Meng, a consultant for the China Automobile Dealers Association. There is a battle brewing over the practice, though.
A Civil War In The Making?
Chinese government officials can’t seem to agree on this practice. Local governments applaud it, going as far as to set up free warehouses for storing zero-mileage used cars. Shenzhen pledged in 2024 to expand its zero-mileage used-car storage to reach an annual target of 400,000 vehicles. Other cities are allowing more registrations beyond previous caps to encourage the practice.
After Jianjun spoke out against it in May, another executive, Zhu Haurong, called it out as having the potential to do enormous damage. Others point out that it calls into question sales figures across the Chinese auto industry. For example, is BYD really selling all the cars it claims it is? This loophole makes it impossible to know for sure.
The People’s Daily newspaper condemned the practice not long after Jianjun’s comments, something that is widely seen as a signal of prominent political figures’ position over the issue. At this point, we must wait and see whether local governments will be forced to change their tune or if somehow the CCP can be persuaded to allow this to continue.
