Chery Refutes $53 million EV Subsidy Audit Claims

- Chery denies improper EV subsidy claims totaling $53 million. - Audit uncovers subsidy discrepancies for Chery and BYD vehicles from 2015 to 2020. On July 12, 2025, China’s Ministry of Industry and Information Technology (MIIT) disqualified $53 million in electric vehicle (EV) subsidy claims from automakers Chery and BYD, citing audit discrepancies. Reuters reported on July 12 that the audit uncovered issues in subsidy applications for 21,725 vehicles. These issues included missing supporting documents and non-compliance with mandated mileage thresholds. Claims from Chery and BYD accounted for nearly 60% of all disqualified submissions during the 2015–2020 audit period, highlighting broader oversight challenges in the country’s EV sector. In response to the findings, Chery issued an official statement denying any fraudulent behavior. The company clarified that it had informed authorities about challenges in retrieving older sales documentation before filing. In its July 12 statement, Chery explained, “Our company has truthfully reported to the authorities we did not collect certificates for end sales; there's no fraudulent act.” The automaker also emphasized that because the audit targeted unpaid subsidy claims, authorities have not demanded repayments or made fraud accusations against it. According to MIIT’s audit, the ministry disqualified 7,663 of Chery’s vehicles, with 7,643 rejected for missing certificates and 19 for mileage-related discrepancies. In comparison, BYD had 4,973 vehicles disqualified but has not yet provided a public response. China’s subsidy program, active from 2009 to 2022, played a vital role in establishing the country as the world’s largest EV market. However, concerns about program oversight persisted throughout its implementation. The recent audit underscores the complexity of balancing market incentives with regulatory compliance. Meanwhile, the auto sector faces additional pressures from intensifying price wars and slimmer profit margins. These conditions challenge players like Chery and BYD to sustain their competitiveness.