Chery recalls 53,882 Omoda and Tiggo 5x cars in China over rear axle welding defect

• Chery recalled 8,878 Omoda 5 cars in Malaysia last month over a similar rear axle welding issue and launched an inspection of same-batch models in China.
• The recall affects 53,882 Omoda series and Tiggo 5x vehicles produced between June 2022 and December 2023.

Chery Auto (HKEX: 9973) is recalling more than 50,000 Omoda series and Tiggo 5x vehicles in China due to a potential rear axle welding defect.

Starting from November 27, Chery will recall a total of 53,882 Chery Tiggo 5x and Omoda series vehicles produced between June 6, 2022, and December 31, 2023, according to an announcement released on Friday by China's State Administration for Market Regulation (SAMR).

Due to manufacturing process issues with the rear axle, the trailing arm and sleeve on the rear axle of some vehicles covered by the recall may have poor welding, the announcement noted.

In extreme cases, the weld seam at this location could fail and detach, causing a loss of wheel control, increasing the risk of accidents, and posing a safety hazard.

Chery will inspect the production date codes on the rear axles of the recalled vehicles free of charge and replace the rear axles for free if they belong to the defective batch to eliminate safety hazards.

Prior to this domestic recall, Chery dealt with a similar vehicle safety issue in an overseas market last month.

On October 6, the rear axle of a 2023 Omoda 5 detached while driving in Malaysia, prompting local regulators to suspend the model's certification and new vehicle registration, after which Chery recalled 8,878 Omoda 5 SUVs locally.

Chery said in an October 11 statement that local welding areas on the rear axle trailing arm of that batch of vehicles might have insufficient strength, and the company had launched a special risk inspection for Omoda 5 cars of the same batch in China and related markets.

That marked the second time the model had been recalled in Malaysia over rear axle issues. In April 2024, Chery recalled 600 vehicles for inspection following a similar rear axle detachment incident locally, with an investigation at the time attributing the issue to improper calibration of rear axle welding equipment.

The Omoda 5 was launched in China in 2022, but due to sluggish sales, its monthly domestic sales did not exceed 1,000 units starting in 2023, after which it was discontinued in China and targeted primarily at overseas markets.

Overseas markets are currently the main driver of Chery's growth. In the first 10 months of this year, Chery Group's cumulative sales reached 2,502,723 vehicles, up 9.34% year-on-year, according to data compiled by CnEVPost.

During the first 10 months, the group's cumulative exports reached 1,751,766 vehicles, up 64.8% year-on-year and accounting for about 70% of total sales over the same period.