One insider said Neta's layoffs could reach up to 70 percent, while another said the percentage varies by division and is not that high overall.
Neta Auto, a unit of Chinese electric vehicle (EV) maker Hozon Auto, has become the latest to face operational difficulties.
Neta initiated massive layoffs today, with one insider saying the percentage could reach up to 70 percent, according to a report in local media outlet Cailian.
Another Neta insider said layoffs vary by department and are not that high overall, according to the report.
A Neta source confirmed to Cailian that the company is undergoing an organizational restructuring, though the percentage of layoffs is unknown, the report said.
On October 29, Neta launched an all-employee equity incentive plan and announced that it would streamline its teams, make the business more focused, and reduce costs by flattening management.
Neta's parent company, Hozon, was founded in October 2014 and in April 2017 received approval from China's economic planner, the National Development and Reform Commission (NDRC), for its automobile production qualifications.
The Neta brand sells models including the Neta X, Neta GT, Neta S, Neta Aya, and Neta L in China, targeting a price range of between RMB 100,000 ($14,000) and RMB 200,000 yuan.
In June this year, Hozon filed an application to list in Hong Kong. But there have been no new developments since then.
In 2021-2023, Neta has accumulated losses of RMB 18.38 billion, with gross margins of -34.4 percent, -22.5 percent, and -14.9 percent, respectively, according to its prospectus.
Neta's monthly car deliveries this year have been lower than the same period last year, except for January and July.
The company delivered 10,118 vehicles in September, down 23.41 percent year-on-year and down 8.06 percent from August, according to data compiled by CnEVPost.
In the January-September period, Neta delivered 85,908 vehicles, down 12.13 percent year-on-year.
The company did not release October delivery figures like its other local peers.
Former Goldman Sachs banker joins Neta to facilitate IPO efforts
($1 = RMB 7.1654)
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