China Is Exporting 'Used' Cars with 0 Miles Globally to Manage Its Significant Oversupply.

      BYD car showroom, China. Bob Henry/UCG/Universal Images Group via Getty Images

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      As part of a comprehensive initiative to support China's domestic automotive production surge, the government is reportedly facilitating the increased practice of exporting inexpensive, zero-mile “used” vehicles to international markets, according to a report from Reuters on Tuesday. The report indicates that China has been shipping these cars, which have not been driven, to Russia, Central Asia, and the Middle East, thereby inflating local sales figures while simultaneously undermining competitors' market positions.

      “A nearly four-year price war has led companies to desperately seek any sales they can find,” stated a U.S.-based analyst to the wire service.

      Most of the vehicles being exported are powered by gasoline, though not exclusively. In the year 2024 alone, approximately half a million zero-mile “used” vehicles were exported.

      The report reveals that the process is both uncomplicated and shameless, often beginning before the vehicle even reaches a showroom. There is typically no actual customer involved; the cars are sold directly to exporters (either by the manufacturer or the intended dealership), registered, and given plates before being shipped out.

      At least 20 local governments in China have been identified as players in this national initiative, helping to arrange various incentives and exemptions to support this practice, such as fast-tracking rebates, providing additional export licenses, and investing in the necessary infrastructure to manage such a significant volume of vehicle exports. Public documents reveal that some have even built warehouse facilities available at no cost for local exporters to store export inventory.

      Sichuan province mentioned in a policy document from last year that it had supported the creation of an online marketplace for its exports through established e-commerce platforms like Alibaba, where over 100 automakers from that province alone have been selling used vehicles to international buyers.

      If that seems substantial, it’s worth noting that even back in 2021, China had more than 300 automakers competing solely in its electric vehicle market, in addition to its internal combustion engine manufacturing capabilities. According to Reuters, the government started actively aiding zero-mile dumping efforts almost immediately following the lifting of export restrictions in 2019.

      This is not the first warning regarding the consequences of China's ambition to position itself as a leader in global EV production. In 2021, Technology Minister Xiao Yaqing indicated that industry consolidation was both unavoidable and encouraged, but stated that the government would find ways to nurture the growth of its automotive sector.

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