Neta Auto’s Survival Bid: RM1.1 Billion Thai Lifeline

Despite Neta Auto repeatedly denying reports of financial distress, recent developments tell a different story as the company secures a THB10 billion (RM1.1 billion) credit line in Thailand. This move underscores its struggles despite offering a glimmer of hope.

While Neta dismisses rumors of disbanding its R&D team, its Shanghai headquarters suggests otherwise. A recent report revealed near-empty offices, with employees idly on their phones or taking long breaks. "Many suppliers have been demanding overdue payments," an employee admitted. "Some have waited for months, even years, with no clear resolution."

Salary cuts have hit workers hard, with some receiving only Shanghai’s minimum wage. With mass departures and minimal internal activity, Neta’s domestic future looks bleak. Meanwhile, its estimated RMB10 billion (RM6.1 billion) in liabilities continues to weigh down operations.

The Thai credit line also arrives as Neta struggles to secure funding. A planned Series E round aimed to raise RMB4-4.5 billion (RM2.5-2.7 billion), with a key investor expected to contribute RMB3 billion (RM1.8 billion), but these funds have yet to materialize.

"Everyone - suppliers, employees - is waiting for financing to revive the company," said an employee.

As Neta turns to Thailand, its domestic operations are collapsing. Three major factories have reportedly shut down, and social media posts show store closures in Nanjing, Shanghai, and Sichuan. The company’s Hong Kong Stock Exchange prospectus also revealed losses of RMB18.4 billion (RM11.3 billion) from 2021 to 2023.

Even in 2022, when it led China’s EV startup sales with 152,000 deliveries, it still failed to turn a profit. Sales also worsened this year. Jan saw a 98% year-on-year decline, and in Feb, the company sold fewer than 400 cars.

Key executives, including former CTO Dai Dali and autonomous driving head Wang Junping, have left for other firms, further weakening the company.

Neta’s pivot to Thailand aligns with founder Fang Yunzhou’s strategy to focus on overseas markets and higher-margin products. The goal is to achieve positive gross margins by 2025 and profitability by 2026. Neta is doing significantly well in Thailand having shifted 7,969 vehicles. In Malaysia however, it only managed to register 271 EV's in 2024 and 16 EVs in the first two months of 2025. 

However, with domestic operations crumbling and investor confidence shaken, it remains uncertain if this expansion can reverse its fortunes. While the Thailand credit line offers a financial boost, the question remains: is this the beginning of Neta’s revival or just a temporary lifeline?