Zero-Kilometer Used Car Scandal: How BYD’s Secrets Sparked a Regulatory Storm || Digging into China

Hi, I'm Dong Seong. Welcome to Digging into China, where we explore China in depths to reveal unique perspectives. On February 7th this year, I released a video stating that BYD is the next Ever Grand, sharing a striking similarity. Both have been accused of deceiving Xi Jinping. Remarkably, this prediction has gained widespread attention across China in recent days. The spark came from an interview with Wei Jenin, chairman of Great War Mode, who spoke candidly, identifying five major issues plaguing the electric vehicle industry. He delivered a statement that ignited the public discourse. Some companies aren't profiting from sales, but are inflating their market value, squandering investors funds. The ever grand of the automotive sector, he said, is already here. It just hasn't collapsed yet. Although we didn't explicitly name BYD, it's widely understood he was referring to them. Why? In China's automotive landscape, only BYD rivals the dominance ever grand once held in real estate. Additionally, Great War and BYD have a contentious history. Previously clashing over fuel tank emissions issues. BYD didn't remain silent. Their PR general manager Lee Yinf posted the three social media updates using phrases like a ghostly whispers and a dogs biting people. Each seemingly to retort to we gen. Doesn't this suggest they are taking it personally? As a result, the public sentiment online has largely coalesed around the idea that we critique targeted BYD. This raises the question, who is Wei Jening, and why does he dare challenge BYD? After all, BYD is a favorite of Xi Jinping in China's media landscape. BYD often wields significant influence over the narratives. Yet this time, they found themselves under intense scrutiny. More significantly, ways mention of zero kilometer used cars prompt the action from China's Ministry of Commerce, which has summoned several automakers for a through thorough investigation. What's happening behind the scene? Has the electric vehicle industry's bubble reached its breaking point? In this video, we'll unpack the public clash between Great War and BYD. Let's begin with Wei Gendering and his motives for targeting BYD. Weii is the founder and the chairman of Great War Motor, one of the few veterans of China's traditional gas powered car industry still standing against the tide of electric vehicles. With 35 years in the sector, starting from a repair shop, his experience is extensive. Great war motor, a prominent domestic brand once dominated China's SUV market with the HAV H6 sales success being waste creation. However, the industry has shifted toward electric vehicles and BYD has surged ahead in just a few years leveraging technology, securing subsidies and investing heavily in advertising. Meanwhile, Great War has struggled with a smart technology and a slow transition to new energy, losing ground in SUV and the pickup markets to BYD's alternatives. In plain terms, BYD is taking Great War's market share. The rivalry isn't new. In 2023, Great War publicly accused BYD's hybrid models of failing emissions standard, sparking a major controversy. Though the issue faded, the animosity persisted. Ways recent criticism aren't driven by industry altruism, but by a rivals frustration. He sees clearly and speaks plainly. The automakers chaos isn't healthy competition, but a facade of prosperity. The ever grand of the auto industry exists. It just hasn't imploded. We's words aren't aimed at the industry alone. They are directed at Xi Jinping. his underlying message. If the government doesn't curb BYD's practices, the entire sector could suffer. With the state addressing cutthroat competition, we is a spotlighting BYD urging action. It's reminiscent of traditional real estate developers in 2018. Outraged by Everrand's high turnover fabricated sales tactics, why did we comments resonate so widely? as an industry insider. His five accusations about the electric vehicle sector are precise, striking at its vulnerabilities. First, some companies don't profit from car sales, but rely on storytelling to boost valuations and deplete investor funds. Second, they inflate sales through zero kilometers used to cost unsold vehicles registered under someone's name to artificially boost numbers. Third, they engage in financial manipulation and cut corners on materials, producing polished financial reports while leaving drivers with unreliable vehicles. Fourth, they wage relentless price wars. A car priced at 200,000 yen dropped to 100,000, raising questions about its quality. Fifth, the most severe, they exploit supplies by delaying payments and forcing price reduction. shifting costs onto them while suppliers struggle. When voiced by netizens, these are complaints from experts. They are recommendations. But from the head of a legacy automaker like a great war, locked in competition with BYD, they are explosive. It's no surprise that the public reaction was intense. The Ministry of Commerce intervened and the zero kilometer used cars are now under scrutiny. We's words have begun to tarnish BYD's reputation. Now, let's examine how many of Wei's five accusations apply to BYD. In my view, they align with all of them. Let's review each one. First, profiting not from sales, but from storytelling and valuation inflation. This describes the BYD perfectly. Their sales are impressive. Global leader, no exaggeration, but their valuation is driven by domestic claims of cuttingedge technology and international branding as a symbol of Chinese innovation. They emphasize independent breakthroughs while capitalizing on political support, blade battery safety, smart technology, luxury branding, global expansion. They promote every angle to appear exceptional. The grander the narrative, the more investors respond, driving stock prices higher. Between 2022 and 2023, BYD's market value exceeded 1 trillion yen, surpassing Toyota and approaching Tesla, an inspiring feat. But do their profits and returns justify this valuation? Frankly, is BYD's value built solely on car sales? Not entirely. It's largely due to their skill in crafting a narrative of China's new energy triumph. They have capability, but their storytelling captivates investors and shareholders alike. On this account, BYD is undeniably implicated. Second, inflating sales with a zero kilometer used cars. When Weey raised this, online discussions erupted with many immediately pointing to BYD. Zero kilometer used cars involve unsold vehicles piling up at dealerships. So, the company registers them to boost the sales figures. How does it work? Manufacturers have dealers register cars under known individuals, counting them as sold. The data looks impressive. These barely driven vehicles then re-enter the market as a used at at a discount. On paper, one car is sold twice, boosting sales and clearing inventory. But ask owners. Some used cars have under 50 kilometers still wrapped in factory plastic. Isn't this deception? Isn't this falsifying sales to mislead investors and policy makers? Wei didn't name BYD, but the Ministry of Commerce's swift investigation into zero kilometer used cars the next day raises eyebrows. Who's the prime suspect? BYD. Online images of dealership lots show dozens of BYD gathering dust despite claims of sold out stock. Some reports suggest dealers buy their own inventory to meet targets, then sell at a loss. In e-commerce, this is a fake transactions. In real estate, it's a fabricated contract. In auto industry, it's a zero kilometer used cars. It's BYD uh copable. No official confirmation, but they are the top suspect. Third, financial manipulation and a cutting corners. Evidence isn't necessary. Common experience suggests that many Chinese companies engage in such practices. It's almost a tradition. Opting out is the exception. Fourth, aggressive price wars in electric vehicle sector. BYD reigns supreme. During the recent June 18 sales, there are not 22 smart driving models saw subsidies up to 53,000 with a starting price as low as 55,800. Is this generosity? Or consider if a cost price dropped by tens of thousands, was it overpriced initially? Or is quality now compromised? Are they benefiting customers or undermining competitors while jeopardizing their own future? We gendering is outspoken. No industrial product can lose 100,000 yen in value without affecting quality. Cars impact lives. Such practices risk safety. Recent examples like a Xiaomi illustrate this. On price wars, BYYD is the leader, fully implicated. Finally, exploiting suppliers. BYD's Dchain supply chain is notorious. My February video detailed its harsh realities. Check it out. In essence, being a BYD supplier is grueling. Extended payment delays and forced price cuts have driven many to bankruptcy. Survival is a feat. While BYD's practice are questionable, their dominance in China's media landscape has been formidable. Search Billy Billy and critical videos about BYD are scarce. Creators avoid naming them describing a certain automaker while clearly meaning BYD. Why? Fear of lawsuits or online harassment. A misstep could lead to severe consequences highlighting BYD's past influence. This time, however, they are faltered, losing control and drawing regulatory attention. Why? three factors. First, their adversary is formidable when we way Jenin isn't like the media, consumers, or suppliers BYD typically intimidates. As Great War Motors chairman with 35 years in the industry, he's a veteran with a strong connections and no need for caution. He fears no retaliation. Moreover, ways timing aligns with national priorities. The government is addressing cutthroat competition as noted in its work report is ways critic critique of BYD coincidental or strategic leveraging state support by isn't facing online critics but an industry titan backed by policy that's a tough challenge second public frustration with BYD has been brewing ways wars gave it a voice BYD's rise relied on price wars tech narratives and patriotic marketing overwhelming competitors. Dealers face price pressure, suppliers are drained, and early owners deal with reduced features. Yet, media is controlled, regulators are silent, and the public is cautious. We's attack was a release for industry and public discontent. This wasn't just way, it was everyone frustrated with BYD's tactics speaking through him. Third, official support bolstered way. Previously, accusing BYD of fake sales could lead to defamation lawsuits. But when we mentioned a zero kilometer used cars, the Ministry of Commerce acted the next day. Launching investigations, this signaled to the public that the issue is credible. BYD now faces not just a PR crisis, but a triple threat. public opinion, regulatory scrutiny, and widespread anger. Worse, they fueled the fire themselves. Their PR chiefs, three social media posts referring uh ghostly whispers and dogs biting people weren't clarifications, but an emotional outburst. At the time when regulators are active, such snoggy response seems defensive, not strategic, damaging their reputation. Further, BY's loss of narrative control isn't accidental. A strong opponent, public outrage, policy alignment, and their own errors have converged. Reflecting on it, BYD mirrors Everrand, hyping narratives, falsifying data, exploiting suppliers, and enjoying media and investor support until the collapse. When will BYD's reckoning come? Will the D chain fail first or will car sales unravel? Time will tell. Thank you so much for watching. 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