IM Motors Dealers in Multiple Cities Face Operational Crisis; Company Says It Is Accelerating Resolution

Gasgoo Munich- Authorized IM Motors dealerships in cities like Kunming and Zhuhai have recently run into operational trouble. Some customers who paid in full are finding themselves unable to take delivery of their vehicles — and struggling to secure refunds.

Image Source: IM Motors

In response, IM Motors dispatched a task force to Kunming and rolled out a guarantee scheme. For customers who have paid but lack the necessary vehicle certificates, the manufacturer will advance full funds to retrieve them. Those with pending orders will retain their original pricing and benefits, with the company coordinating nearby dealerships to complete deliveries.

IM Motors acknowledged that resolving the situation takes time, given the large sums of money involved and the need to coordinate with multiple institutions. The company is now pushing to accelerate the process and actively addressing reasonable customer demands.

On July 7, the IM Motors Guandu User Center — operated by Kunming Zhihe Yuexing Auto Sales Service Co. — suddenly emptied out. Display vehicles and office equipment were removed, and staff resigned. The company operates three IM Motors dealerships in Kunming.

The dealership's legal representative admitted that its capital chain had snapped, citing soaring operational costs as the root cause. Annual rent for the three locations exceeded 3.6 million yuan, while monthly wages ran around 500,000 yuan. Sales revenue and manufacturer rebates failed to cover these expenses, ultimately trapping the company in a cycle where new customer payments were used to cover the cost of retrieving vehicle certificates for previous sales.

The incident highlights the broader strain weighing on China's auto dealership sector. Data from the China Automobile Dealers Association (CADA) shows the dealer inventory warning index stood at 57.2% in June 2026, up 0.6 percentage points from a year earlier and remaining above the 50% benchmark. Dealers are grappling with a trifecta of pressures: price inversions, bloated inventories, and declining foot traffic.

IM Motors delivered 40,087 units in the first half of the year — a 58% jump from last year. The company has largely shifted its sales network from an early direct-sales model to a dealership franchise system. Finding the balance between driving sales growth and managing channel risks has become a critical challenge across the industry.