On August 7, Chery Group's legal department issued a statement addressing the malicious rumors circulating online regarding a purported altercation between a Chery senior executive and a dealer. Following a report to the authorities, the Economic and Technological Development Zone Branch of the Wuhu Municipal Public Security Bureau identified the perpetrator as Mr. Hu (male, 37 years old), who had employed AI technology to fabricate and disseminate false information. The investigation confirmed the facts, leading to Hu's administrative penalty in accordance with legal procedures, which has now been fully enforced. Hu has acknowledged his illegal actions and issued written and video apologies to both Chery and the implicated senior executive. Public security authorities are continuing their investigation into other acts of malicious dissemination related to this incident.

In June, rumors emerged alleging that Chery's second-highest-ranking executive had engaged in a heated confrontation with Dai Deming, chairman of Hengxin Automotive Group—a prominent dealer group—over issues concerning new car delivery volumes and rebates. The rumors further claimed that after negotiations failed, the Chery executive was surrounded and assaulted by dealers, resulting in one dealer being hospitalized with broken ribs. These rumors, replete with vivid details such as a locked meeting room, security personnel blocking exits, and physical altercations, sent shockwaves through the industry. They had a substantial negative impact on Chery, affecting not only the company's reputation but also its senior executives and the dealer group involved.

In the current fiercely competitive business landscape, such rumors have raised external concerns about the quality of Chery's development and the health of its operations, particularly given Chery's status as a publicly listed entity.

In response to the rumors, on the evening of June 3, Chery Group's legal department issued a statement refuting the online claims of a conflict between a company senior executive and a dealer. The statement read, "The content circulating online about a dispute and even physical altercation between Chery's senior executives and dealers is entirely fictional and maliciously fabricated. We urge the public not to believe or spread such rumors. Our legal department has launched an investigation into the source of these rumors and filed a police report; we will pursue this matter to its fullest extent."

Indeed, following the rumors' emergence, Zhang Guozhong, the executive in question, was specifically asked about the incident. He responded, "Hello! Thank you for your concern and support! I have not been to Wuhan this year and have had no contact with them. This is completely unfounded." This statement effectively debunked the rumors.

Moreover, in the first half of this year, Chery has been proactively reducing the burden on its dealership channels. At the launch event for the Chery Fengyun on July 25, Yin Tongyue, Chery's chairman, stated, "After reaching 20 million vehicles, Chery will no longer engage in cutthroat competition or solely pursue sales volume. Instead, we will focus on brand elevation, value creation, innovation, technological breakthroughs, and significantly improving customer satisfaction."

In the domestic market, Chery took the initiative in the first half of the year to alleviate the pressure on its dealers by reducing inventory levels. Yin Tongyue noted that Chery shipped 150,000 fewer vehicles in the first half of the year. Although this appears as a decline in sales, the proactive reduction in burden has helped restore the health of the dealership channels, which is of greater significance. In this context, Chery's core growth driver lies in overseas markets, which continue to underpin its sustained growth.

Official data reveals that in the first half of the year, Chery sold a cumulative total of 1.3575 million vehicles, marking a year-on-year increase of 7.7% and setting a new historical record. It ranked first among the top five domestic independent automotive brands. In June alone, Chery sold 256,000 vehicles, a year-on-year increase of 9.8%. Additionally, Chery's new energy vehicle sales reached 475,000 units in the first half of the year, a year-on-year increase of 32.3%, with wholesale volumes ranking among the top three in the industry.

Of course, this incident also brought sudden attention to Hengxin Automotive Group. Hengxin is Chery's largest national dealer and a leading enterprise among Chinese automotive dealer groups. In the 2026 Top 100 Dealers list released by the China Automobile Dealers Association, Hengxin Group ranked second, just behind Zhongsheng Group. The group operates over 300 4S dealerships and has an annual turnover of approximately 73.4 billion yuan.

With the increased attention on Hengxin, it was discovered that the group is also actively venturing into automobile manufacturing. On July 11, the first ET engineering prototype vehicle from Chugneng Automobile rolled off the production line at the Wuhan Research Institute's pilot production center. Chugneng Automobile Co., Ltd. was established in December 2024 with a registered capital of 2 billion yuan, jointly owned 50-50 by Hengxin Automotive Group Corporation and Dai Deming, the chairman of Hengxin Automotive Group.

Furthermore, Dai Deming and his companies also control Chugneng New Energy Co., Ltd. Established in August 2021 with a registered capital of 4.94 billion yuan, Chugneng New Energy is headquartered in Xiaogan, Hubei, and specializes in the research and production of energy storage batteries and power batteries. It provides core three-electric technologies (battery, motor, and electronic control) and supply chain support for vehicle production, ensuring core quality and cost advantages for vehicle models.

According to data disclosed by Chugneng New Energy, the company's annual effective battery production capacity reached 110GWh in 2025, with total planned capacity exceeding 500GWh. Battery shipments exceeded 90GWh in 2025. Thus, Chugneng Automobile has formed an integrated new energy vehicle industry closed loop encompassing "batteries + vehicles + dealerships." It is worth noting that this is not the first instance of a dealer venturing into automobile manufacturing.

As such, Hengxin possesses three key links in the automotive industry chain: vehicle manufacturing, dealership channels, and batteries, effectively forming a complete industry chain. It is worth mentioning that online rumors suggest that Chugneng Automobile will take over the former WM Motor's vehicle manufacturing plant in Huanggang, Hubei. The plant commenced production in January 2020 with a planned Phase 1 capacity of 150,000 vehicles but ceased operations in October 2022 due to WM Motor's operational difficulties.