China‘s commerce ministry is cracking down on a growing trend in the electric vehicle (EV) market: the sale of “zero-mileage” used cars—vehicles registered and plated but never driven. This practice, highlighted by Great Wall Motor’s Chairman Wei Jianjun, has sparked a regulatory response as automakers like BYD and Dongfeng Motor navigate intense competition and aggressive sales targets. A Reuters report details the ministry’s meeting with industry leaders to address this controversial tactic, raising questions about its impact on EV buyers and the broader market.

The Zero-Mileage Phenomenon

The “zero-mileage” used car trend has emerged from China’s fierce EV price war, where automakers face pressure to meet high sales goals. Wei Jianjun explained in a Sina Finance interview, “A phenomenon called ‘secondhand cars with zero mileage’ had emerged in the Chinese market as a result of the industry’s years-long price war.” He noted that 3,000 to 4,000 vendors on Chinese used car platforms are selling these vehicles, which are registered as sold but remain unused. This allows dealers to inflate new car sales figures while offloading these “used” EVs at discounted prices, often to unsuspecting buyers.

Industry and Regulatory Response

On May 27, 2025, China’s commerce ministry convened a meeting with major players, including BYD, Dongfeng Motor, the China Association of Automobile Manufacturers (CAAM), and the China Automobile Dealers Association (CADA). The discussion, held in Shanghai, also involved used car trading platforms. The ministry aims to examine whether this practice undermines market transparency and consumer trust. A source told Reuters, “The tactic was seen as a potential method within the industry for automakers and dealers to support new car sales as they try to meet aggressive sales targets.” No official comments were provided by BYD, Dongfeng, or CADA, and Great Wall and CAAM declined to respond.

Implications for EV Buyers and the Market

For EV owners and enthusiasts, the zero-mileage trend offers both opportunities and risks. These vehicles, often sold at lower prices than new models, may appeal to budget-conscious buyers. For example, a BYD model originally priced at 150,000 yuan ($20,700 USD) could appear on used car platforms for significantly less, despite having zero miles. However, buyers may face challenges with warranties, as these cars are technically “used,” potentially voiding manufacturer coverage. Additionally, the practice could erode trust in the used EV market, making consumers wary of hidden registration issues.

From an industry perspective, the tactic highlights the strain of China’s EV price war. With over 100 EV brands competing, companies are slashing prices—sometimes by thousands of dollars—to capture market share. This has led to a 3.1% drop in shares for BYD and Zhejiang Leapmotor, and a 2% decline in Hong Kong’s Hang Seng Automobile Index, as reported by Reuters. The regulatory scrutiny could push automakers to adopt more transparent sales strategies, potentially stabilizing prices but increasing costs for manufacturers.

What’s Next for China’s EV Industry?

The commerce ministry’s intervention signals a push for stricter oversight in China’s EV market, which produced over 9 million vehicles in 2024, according to CAAM data. If regulations tighten, dealers may need to revise sales tactics, impacting profit margins. For EV enthusiasts, this could mean a more reliable used car market but potentially higher prices for new vehicles. As the ministry’s discussions unfold, the industry awaits clarity on how these changes will reshape the competitive landscape for electric vehicles.

Photos courtesy of BYD