China Auto Industry Inflates Sales By Exporting New Cars As "Used"

China’s auto industry has artificially inflated sales for years through a government-backed gray market that registers brand-new cars as “used” before shipping them overseas, Reuters reported.

The issue gained national attention only after the head of Great Wall Motor criticized the practice of selling zero-mileage cars domestically in May. I Photo: Great Wall Motor Facebook

These so-called “zero-mileage” vehicles—never driven but registered as used—are being exported to markets such as Russia, Central Asia, and the Middle East, allowing Chinese automakers to report growth and offload surplus vehicles amid weakening domestic demand.

The findings come from a Reuters review of government documents and interviews with five auto dealers and exporters.

“This is the outcome of an almost four-year price war that has made companies desperate to book any sales possible,” said Tu Le, founder of Michigan-based consultancy Sino Auto Insights.

The issue gained national attention only after the head of Great Wall Motor criticized the practice of selling zero-mileage cars domestically in May.

On June 10, the People’s Daily—a publication aligned with China’s Communist Party leadership—condemned the practice, blaming it for worsening the domestic price war and urging regulators to act.

However, according to Reuters' Gleb Stolyarov, reporting from Georgia, the export of such vehicles is actively encouraged by regional governments in China, as documented in state media and government filings.