Zero-kilometer used cars: Setting traps for consumers in the gray business of new energy subsidies.

Since June, car salespeople added by reporters from Power Plant have been frequently urging customers to place orders on their WeChat Moments: "Replacement subsidies in many places have been clearly suspended. Friends with replacement plans should hurry up." "Replacement subsidies are ending one after another. Next year, the purchase tax will be reduced by up to 15,000 yuan. Those who want to buy a car can consider making a move in advance." Behind these "last chance" reminders is the fact that car subsidy policies in various places are quietly tightening.

As multiple cities in provinces such as Henan, Guangdong, Jiangsu, and Liaoning have successively announced the suspension of car replacement subsidies, consumers' anxiety has quickly spread on social platforms: Some people found that the subsidy was cancelled before they picked up their cars; some were about to make a payment but saw that the subsidy was suddenly stopped in another city and chose to wait and see; many users who planned to buy a car in the second half of the year are worried, "Is this wave of subsidies over?"

Subsequently, the National Development and Reform Commission and the Ministry of Finance responded, clarifying that the unified deadline for the national subsidy policy in 2025 is still December 31. The current suspensions in various places are only temporary adjustments, and 138 billion yuan in central funds will be allocated in batches in the third and fourth quarters.

The main reason for the suspension of car subsidies in some areas is that the first round of funds has been exhausted. On the one hand, this is the result of expanding consumption. According to the prediction of the China Automobile Dealers Association, more than 15 million passenger cars will enjoy subsidies in 2025. On the other hand, the increase in "subsidy fraud" has also accelerated the consumption of funds. The relevant person in charge of the Ministry of Commerce clearly pointed out that the next round should "strictly prevent subsidy fraud and embezzlement."

Rampant scalpers, car salespeople colluding with them, and the "zero-kilometer used cars" in the gray area tacitly approved by the industry... They are not only consuming car subsidies but also reaching into consumers' pockets.

Consumers' Dilemma with Subsidies: Threatened by Scalpers and Delayed by Manufacturers

Under the current subsidy mechanism, consumers are particularly passive.

On the one hand, they do not have control over the timing of subsidies. For example, a netizen from Xinjiang named "Gentle Breeze Whisper" posted on Xiaohongshu: "The replacement subsidy suddenly stopped. It's a disaster." She said that after paying a 5,000-yuan deposit to order a new car in April this year, Xinjiang suddenly suspended the replacement subsidy in June. According to the rules, one had to issue a car purchase invoice before June 15 to enjoy the 20,000-yuan "factory subsidy + provincial subsidy." However, the car was only shipped from the factory on June 7, and it was very likely that it would not arrive at the store in time to issue the invoice.

The salesperson proposed a "remote subsidy" plan, such as issuing an invoice in Guizhou to get the Guizhou subsidy. However, the netizen was worried about the risk of being deceived. She is not the only one with a similar experience. A netizen from Hubei said that the municipal subsidy was suspended on the day he picked up the car, resulting in the loss of a part of the car subsidy.

Some consumers who sensed the trend have become more inclined to wait and see. A netizen from Henan named "Xiaofan's Tangyuanzi" said, "Those who wait will never lose. I just felt that the subsidy would end. I didn't believe the salesperson's nonsense. There was no in-stock car, and I could only pick it up in July. Sure enough, I was notified yesterday that the subsidy had ended."

When the number of subsidy quotas is limited, real consumers are often at a disadvantage. For example, for municipal or district subsidies where consumers need to grab quotas on a WeChat mini-program, many netizens reported that scalpers were using ticket-grabbing software to cheat, leaving real consumers empty-handed.

Scalpers not only have technological means but also form a complete gray industrial chain of "subsidy fraud and embezzlement" with the sales end, and consumers' interests are at the bottom of this chain. After the subsidy policy was introduced, many scrap car scalpers began to sell "subsidy quotas," claiming that they could use their scrap cars to apply for subsidies on behalf of others and take a cut afterwards.

This kind of operation generally requires the buyer to register the new car under the seller's name first and then transfer the ownership after the subsidy arrives. On the surface, it seems to be a win-win situation, but in fact, it is extremely risky. Consumers need to register the new car under someone else's name, which not only makes it difficult to guarantee the funds but also may lead to problems such as non - payment of subsidies and disputes over vehicle ownership. In addition, since the identity of the first - owner is highly related to subsequent rights, once the ownership is transferred, new energy vehicle owners may lose their original rights.

Meanwhile, it has become normal for scrap car scalpers to "raise the price on the spot." An owner of a new energy vehicle named "Uncle's Car" complained on Xiaohongshu that he found a scalper through a salesperson to handle the scrap car subsidy. Initially, it was promised that paying 5,000 yuan could get a 10,000 - yuan subsidy. Later, when the policy increased the subsidy amount to 20,000 yuan, the scalper suddenly raised the price to 8,000 yuan. The salesperson and the scalper were in the same camp and asked the owner to pay the extra money. The owner had a dispute with the salesperson because he opposed the price increase. Since his personal information was in the hands of the scalper, he was also threatened.

Consumers are not only frightened by scalpers but also have to defend their rights every day because of the manufacturers' empty promises. On the Auto Quality Network, there are almost daily complaints from consumers about the long - overdue payment of car subsidies, involving a wide range of brands.

The Rampant Zero - Kilometer Used Cars for Subsidy Fraud Are Being Surrounded

Zero - kilometer used cars are a "hotbed" of subsidy fraud. They can not only obtain replacement subsidies through under - the - table operations but also get another subsidy, the export tax rebate for used cars when they are exported. This is also the destination of most zero - kilometer used cars.

"Zero - kilometer used cars are actually a parallel used car export model," Li Jing (a pseudonym), an automotive foreign trade practitioner, explained to Power Plant: A new car just picked up from a 4S store can nominally "transform" into a used car after completing one registration procedure. Then, it can be resold for export through a dealer or an auto trading company to obtain the relevant tax rebate for used car exports from the country. She admitted that some companies used to widely use this model to make profits, and the tax rebate was the major part of the profit. "But our company started to transform in 2023, focusing on pure used car exports and no longer touching the tax rebate part."

Compared with real used cars with mileage and vehicle condition records, the "used" nature of zero - kilometer used cars is not in line with the name, but they have long been in the gray area of supervision and have become a high - incidence area of subsidy fraud. She mentioned that the state has become aware of this problem, and the tax rebate review has been significantly tightened in the past year, and the relevant industrial chain has been investigated more and more strictly.

However, this model was previously tacitly approved in the industry. "To put it bluntly, it was to digest inventory," she said bluntly. "Many new - energy vehicle brands couldn't sell well in the domestic market in 2021 and 2022. Cars like Zeekr and Li Auto had poor sales in China, but foreign customers especially liked them, especially in Central Asia and North Africa." Foreign trade merchants placed orders through the APP in their personal names, registered the cars in China, and then resold them for export. Although this bypassed the authorization system of the original equipment manufacturers (OEMs), it helped the enterprises find an "outlet" to digest inventory.

In addition to inventory pressure, zero - kilometer used cars also have another identity - the "pioneers" going overseas. Before many OEMs have completed local factory construction, channel establishment, and after - sales system setup, foreign trade companies often take on the role of "showcasing products" and sell Chinese cars to markets such as the five Central Asian countries, Southeast Asia, and Latin America through unauthorized channels, "which is equivalent to helping them open up the overseas market."

However, this "help" is not always recognized by OEMs. As the overseas strategies of brands like Li Auto and Zeekr accelerate, more and more enterprises are starting to block unauthorized foreign trade channels. "For example, Li Auto and XPeng directly lock the car infotainment system."

What's more worrying is that the chaos in the export of zero - kilometer used cars has caused substantial damage to the long - term development of Chinese car brands overseas. "Some peers would privately modify cars, for example, converting low - end cars into high - end ones by adding audio systems, seats, and head - up displays, and even changing the name of a gasoline car to an electric car to avoid purchase tax," she admitted. This kind of "bait - and - switch" operation seriously damages the brand's reputation overseas. Once the vehicle breaks down, since foreign trade merchants generally lack a local after - sales system, consumers have nowhere to complain, which ultimately damages the image of the entire Chinese brand.

In her opinion, the original intention of the state to promote the export of used cars is to drive the circulation of real used cars and promote replacement. "Now that new cars are cheap enough, many private car owners are reluctant to buy used cars, causing car dealers to have a large inventory. If these cars can be exported through foreign trade, it can revitalize the domestic used car market." However, the prevalence of zero - kilometer used cars has, to some extent, misinterpreted this policy. "The tax rebate, which was supposed to stimulate real consumption, has become a tool for arbitrage."

As the trend changes, transformation has become a consensus in the industry. "Many small companies went bankrupt in 2024. The ones that remain are enterprises with customer accumulation, capital, and a sense of transformation," she said. The real direction is to seek growth in compliance.

The Call for "Equal Treatment of Gasoline and Electric Vehicles" Is Rising Again, and the Low - Price Segment Is Most Affected

Judging from the chain reaction caused by the news of "subsidy suspension," the impact of subsidy policies on consumers' car - buying decisions cannot be ignored. Many netizens said bluntly, "I decided to buy a car because of the subsidy." According to the public data from the Ministry of Commerce, since the implementation of the car replacement policy in 2024, the cumulative number of subsidy applications nationwide has exceeded 10 million, and the proportion of those replacing with new energy vehicles is more than 60%.

However, there are also more and more voices in the industry believing that subsidies are distorting normal market competition. The call for reform centered on "equal treatment of gasoline and electric vehicles" is heating up. In May this year, Wei Jianjun, the chairman of Great Wall Motors, clearly stated in a media interview that the current state of new energy vehicles relying on subsidies for growth is not healthy, and the subsidy mechanism should be phased out as soon as possible to let enterprises that cannot achieve commercialization be eliminated. Just looking at the scrap subsidy, new energy passenger cars can get a 20,000 - yuan subsidy, while fuel - powered cars only get 15,000 yuan, which shows an obvious inequality.

In June, Cui Dongshu, the secretary - general of the China Passenger Car Association, further pointed out in a live - stream that the tax burden gap between new energy vehicles and fuel - powered cars is also huge. He said that fuel - powered cars are managed as luxury goods and have a huge tax pressure, while new energy vehicles, as tax - free products, have extremely low costs, so it is difficult for them to compete. "Fuel - powered cars bear all the social responsibilities of the entire automotive market, pay huge taxes, and bear a lot of blame."

At the 2025 Guangdong - Hong Kong - Macao Greater Bay Area Auto Show, Li Fenggang, the deputy general manager of FAW Audi Sales, also expressed the same stance. He pointed out that the tax cost of a fuel - powered car is currently about 15% higher than that of a new energy vehicle and called for the early realization of "equal rights for gasoline and electric vehicles" to let car enterprises compete on a fair starting line.

The impact of subsidies on sales is also clearly visible in the data. According to the data from the China Passenger Car Association, the sales of new energy vehicles priced below 50,000 yuan decreased by 24.2% year - on - year in 2023. In 2024, driven by increased subsidies, the sales of new energy vehicles in this price segment increased by 44.7% year - on - year. This shows that after losing the price advantage, the sales potential of low - price new energy vehicles will be significantly suppressed. In this price segment, subsidies are still the key lever to boost sales.

This article is from the WeChat public account "Power Plant", author: Zhai Fangxue. Republished by 36Kr with permission.