Neta Auto, once a rapidly ascending electric vehicle startup from China, is now confronting a severe consumer backlash in Thailand, its primary overseas market, as its parent company, Hozon New Energy Automobile, enters bankruptcy restructuring. This development, unfolding in recent weeks, highlights the escalating risks associated with China's fierce domestic EV price war, which is compelling smaller manufacturers to seek international growth before achieving financial stability at home. The situation in Thailand, where Neta had previously seen significant sales, is raising concerns among industry observers about the potential for broader reputational damage to Chinese automotive brands expanding globally.

Neta initially gained considerable traction in Thailand by offering attractive incentives, including complimentary home-charging equipment and extended warranties. However, its Thai social media channels have recently been inundated with complaints regarding inadequate after-sales support, prolonged unavailability of replacement parts, and the closure of local service centers. Thai consumers, like businessman Chaicharn, who purchased a Neta EV for 549,000 baht ($16,973) in January last year, are now initiating refund processes due to these service deficiencies and the parent company's financial instability.

Industry analysts suggest that Neta's predicament marks a critical juncture, as the fallout from China's aggressive EV price war, which has seen numerous domestic brands fold or struggle with after-sales support, is now directly impacting international markets. Over 30 Chinese EV brands ventured abroad last year, many without achieving profitability in their home market. Li Yunfei, BYD's general manager of brand and public relations, commented at a June 6 industry forum, "If companies aren't doing well locally, expanding overseas may not be a good thing. This can damage the overall image of Chinese brands."

The Chinese EV market has undergone rapid consolidation, with the number of domestic manufacturers plummeting from 487 in 2018 to approximately 130 in 2024. Forecasts from AlixPartners anticipate fewer than 15 brands will survive by 2030. This intense domestic pressure, coupled with warnings from China's top economic planning agency against selling cars below cost, has driven many smaller players to look overseas. Lei Xing, a U.S.-based China auto industry consultant, characterized Neta's international push as a "sign of desperation," arguing that such strategies, purely aimed at salvaging domestic business, are unlikely to succeed. Other struggling Chinese EV makers, including Aiways and WM Motor, have also pivoted to international markets, with Aiways even suspending domestic operations to focus on Europe.

Despite its current woes, Neta had a strong start in Thailand after entering the market in 2022, selling over 12,000 vehicles in 2023 and ranking second in EV sales behind BYD. This success was significantly bolstered by generous Thai government subsidies tied to local production, a key incentive for Chinese EV makers in Southeast Asia. Buoyed by this initial performance, Neta's founder, Fang Yunzhou, had expressed ambitions to sell half of the company's vehicles abroad and achieve profitability by 2026. However, signs of strain emerged earlier, with staff layoffs and cost-cutting measures. In 2024, Neta's sales in China dropped by nearly 50% year-over-year, and sales in Thailand also slumped, with only 1,256 units sold in the first five months of this year, a 43% year-on-year decline. Thai media has also reported hundreds of local staff layoffs and the closure of 20 out of 60 showrooms.

The Thailand Consumers Council has reported a surge of over 220 complaints against Neta since 2022 and is now supporting a government investigation. While Neta stated in June that it is undergoing restructuring and seeking new investment to "amplify its focus on key markets" like Thailand, Malaysia, and Brazil, the immediate impact is evident. In response to the growing concerns, the Thai government is reportedly considering tightening EV subsidy rules, which could affect the approximately 18 Chinese EV brands operating in the country. While Chinese models remain popular in Southeast Asia due to their affordability—typically 20% cheaper than Japanese and Western alternatives—experts like Kriengkrai Techakanont, an economics professor at Thammasat University, emphasize that competitive pricing alone will not suffice. "Service networks and long-term support will play an increasingly important role in consumer decision-making when choosing an EV brand," Techakanont stated.