Summary of Key Points
A covert investigation by CCTV revealed a gray market in the electric vehicle industry in Taizhou, Zhejiang, involving “0-kilometer second-hand electric vehicles.” Dealers use a series of fraudulent practices—stockpiling ID cards, registering vehicles with official licenses before manufacturing them, altering their specifications to exceed safety standards, and then transferring ownership while falsifying the mileage—to disguise these vehicles as “second-hand” cars with zero mileage. This allows them to circumvent the new national standard, which limits the maximum speed to 25 kilometers per hour. Almost simultaneously, the Beijing Market Supervision Bureau met with eight leading brands, including Yadea and Aima, and explicitly prohibited behaviors such as reserving space for modifications and manipulating vehicle mileage. This is not an issue isolated to individual dealers; it represents a tacit industry norm. Either the brand owners are complicit or their control mechanisms are inadequate, resulting in consumers purchasing vehicles that appear to be a good deal but are actually dangerous.
Detailed Analysis
The “0-Kilometer Second-Hand Vehicle” Scam
The so-called “new second-hand cars” are actually the result of a clever scheme by dealers:
1. Step 1: Stockpiling ID Cards: Dealers collect personal information from ordinary people (either purchased or borrowed) and register a large number of official electric vehicle licenses in advance, even though the vehicles corresponding to these licenses may not have been manufactured yet.
2. Step 2: Manufacturing Excessively Fast Vehicles: Once the licenses are obtained, they produce vehicles that exceed the new national standards (e.g., capable of reaching speeds over 50 kilometers per hour). The process is reversed: the vehicles are licensed first, and then manufactured.
3. Step 3: Transfer Ownership with Fake Licenses: The pre-registered licenses are transferred to these illegally modified vehicles, giving them a “legal” appearance.
4. Step 4: Selling as Second-Hand Cars: The mileage on the vehicles is reset to zero, and they are sold in the second-hand market at lower prices, leading consumers to believe they have made a bargain.
In essence, this scheme uses “legal licenses” to cover up the fact that these vehicles do not meet safety requirements.
The Silence of the Eight Leading Brands
After being approached by authorities, none of the eight brands responded publicly. There are practical reasons for their silence:
- Blaming Individual Dealers No Longer Works: In the past, problems could be attributed to independent franchisees, but with all eight brands being affected using the same tactics, it’s clear the issue is widespread and well-known within the industry. The brands must be aware, as they manufacture the vehicles, provide the modifications, and supply the necessary equipment.
- Hoping Public Opinion Will Forget: Many consumers prefer faster electric vehicles, and as long as no major accidents occur, they may not pursue further investigation. Brands hope that public attention will wane over time.
- Waiting to See How Other Brands React: No brand wants to be the first to take responsibility; if one apologizes, others might follow suit, shifting the blame to that brand.
In other words, their silence implies acknowledgment of guilt: they cannot deny the issue without losing credibility.
The New National Standard Being Misused
The new standard aims to prevent accidents caused by high speeds and excessive weight in electric vehicles. However, brands and dealers have exploited it:
- Brands Leaving Loopholes: They intentionally design vehicles with modifiable components and provide decoding equipment that allows them to increase the speed limit.
- Dealers Exploiting the Loopholes: By registering vehicles first and then manufacturing them, they ensure that these illegally modified vehicles receive legal licenses, making it difficult for consumers to recognize their status.
Brands benefit from higher sales, while dealers make larger profits. Consumers bear the risk: in the event of an accident, they may suffer personally and be held liable for driving a non-compliant vehicle.
The Limited Effectiveness of Regulatory Actions
The Beijing authorities’ meeting with the eight brands is intended to set an example for the entire industry. However, its impact may be limited:
- The Meeting Is Not a Punishment: It was merely a verbal warning without any concrete consequences such as fines or production suspensions. Brands might simply submit a report and move on.
- The Criminal Activity May Adapt: Dealers could change their tactics (e.g., re-labeling “0-kilometer vehicles” as “near-new”) or operate in different locations, as long as profits remain attractive.
The real solution lies with brand owners: they must effectively regulate their dealers (for example, revoking licenses from non-compliant stores and stopping the supply of modified parts). Without proper oversight, the problem will persist.
Consumers Should Be Cautionous
For consumers:
- “0-Kilometer second-hand vehicles” are a scam: They appear new and licensed but lack safety certifications. Their brakes and batteries may not meet standards, and vehicles capable of reaching 50 kilometers per hour may be unable to stop in emergencies.
- Don’t Be Misled by the Appearance of Compliance: Even if a vehicle has a license, it is still non-compliant, and insurance companies may refuse to cover accidents. Remember: cheap, new-looking electric vehicles are likely to have issues.
Conclusion
This incident highlights a systemic failure within the entire electric vehicle industry. Brands tolerate violations for sales growth, dealers take risks for profit, and regulatory efforts are insufficient. Consumers should ensure that vehicles meet the new national standards (check for CCC certifications and speed limits) to avoid buying unsafe products. Brands must take responsibility to prevent similar issues from happening in the future.