Neta to swap debt for equity with 134 suppliers: report

Financially-challenged Neta has, according to Chinese media, reached a debt-to-equity swap agreement with 134 core suppliers worth over RMB2 billion (RM1.2 billion) so that production can continue, according to a report by CnEVPost.

Neta offered to convert 70% of its suppliers’ claims to equity in its parent company Hozon Auto, with the remaining 30% to be treated as interest-free debt that will be repaid equally over 15 months beginning May, media outlet Jiemian reported. According to media outlet Yicai, CATL and Gotion High-tech are among the big suppliers that have said yes.

News of Neta making large-scale layoffs first surfaced in November 2024, and according to media outlet 21jingji, Neta met some suppliers at its Shanghai HQ on March 19 to discuss converting its suppliers’ debts into shareholdings, as potential investors wanted Neta to reduce its debt before they were willing to provide new investment.

Neta’s total liabilities currently stand at nearly RMB10 billion (RM6 billion), nearly two-thirds of which are owed to suppliers, according to 21jingji. Although Neta delivered 152,073 vehicles in 2022 (+118% year-on-year), sales have been weak in the past two years, and the carmaker has stopped publishing monthly deliveries since October 2024, CnEVPost reports.

Neta did, however, participate in the 2025 Bangkok motor show, where it announced its aim to sell over 10,000 units a year in Thailand. On March 22, Neta secured a 10 billion baht (RM1.3 billion) credit line from Nissan Leasing (Thailand). The Nation reported in late-March that Neta vowed to resume Thai production in June after clearing its debts with suppliers and dealers.

Meanwhile, The Business Times reported earlier this month that Neta’s sole Singaporean showroom had shut after just three months of operation and four units registered, according to Land Transport Authority data.

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