Zotye Automobile settles dispute, boosts liquidity

Zotye Automobile Co., Ltd. announced a settlement in a lawsuit involving its wholly-owned subsidiary, Zhejiang Shenkang Automobile Body Mold Co., Ltd., and Shanghai Automotive Transmission Co., Ltd. The sales contract dispute was resolved through a civil mediation agreement. An initial judgment on June 28, 2025, had ordered Shanghai Automotive Transmission Co. to pay Shenkang Company 48,215,011.5 yuan plus interest. Shanghai Automotive Transmission Co. subsequently appealed this decision.

Under the new mediation agreement, Shanghai Automotive Transmission Co. is obligated to pay Shenkang Company 29,000,000 yuan within fifteen days of receiving the mediation document. Upon receipt of this payment, both parties will consider all disputes related to the case fully settled.

Zotye Automobile anticipates that this settlement, if the payment is received by December 31, 2025, will significantly enhance the company's liquidity and positively impact its current period's performance. The company will process the transaction in accordance with accounting standards.