Toyota reportedly eyes struggling EV maker Neta to revive China strategy
Toyota is reportedly considering the acquisition of crisis-hit Chinese EV manufacturer Neta Auto in a potential move to strengthen its electric vehicle strategy in China. According to Chinese media outlet Kuai Technology, cited by CarNewsChina, discussions are underway but remain unconfirmed by the Japanese carmaker.
Despite the operational crisis, Neta maintains strategic assets, including local market experience, supplier ties, and production licences—elements Toyota could leverage to accelerate its electrification push in China, where it currently lags behind domestic giants like BYD and Nio. While Toyota China’s spokesperson Xu Yiming denied knowledge of any ongoing talks, a successful acquisition would represent a rare case of a Japanese OEM acquiring a Chinese EV firm—a signal of intensifying competition in the region’s electric mobility landscape.
Founded in 2014 by Hozon New Energy Auto, Neta Auto has faced significant financial distress since mid-2024, with production halts, mass layoffs and failed attempts to raise capital. Founder and long-standing CEO Fang Yunzhou is said to have focused too much on B2B channels after early successes and neglected other areas.
Neta’s valuation has plummeted. By March 2025, Chinese media reported that Neta had dismissed its entire research and development team amid escalating financial turmoil, further casting doubt on the company’s ability to recover independently.
According to Chinese media, the company’s most recent funding setback came in February 2025 when a much-needed E-round financing deal collapsed. A BRICS-nation-backed investor had pledged 3 billion yuan (approx. €386 million), contingent upon the resumption of production and the securing of matching capital. Neither condition was met, leading to the withdrawal of the investment.
Neta briefly resumed operations at its Tongxiang factory in January, but persistent component shortages forced another shutdown. As of May, the company has accumulated losses of 18.3 billion yuan (€2.36 billion) over the past three years, with 6 billion yuan (€775 million) still owed to suppliers, according to CarNewsChina. A debt restructuring proposal—converting 70% of liabilities into equity—has so far failed to reassure creditors.
There are also international repercussions. In Thailand, where Neta previously benefited from EV subsidies, the company risks significant financial penalties if it fails to meet local production targets by the end of 2025.
Again, any deal or even Toyota’s intentions have yet to be confirmed. Nonetheless, an acquisition could offer Toyota a shortcut to local market knowledge, supplier networks and manufacturing assets as it seeks to ramp up its electric mobility footprint in China, where domestic players like BYD currently dominate the market.
0 Comments