Zeekr Intelligent Technology (ZK) allegedly inflated its sales figures by insuring unsold vehicles to meet monthly and quarterly sales targets, Reuters reported Monday, citing documents and interviews with dealers and customers.

According to the report, Zeekr, through its primary distributor, state-owned Xiamen C&D Automobile, pre-registered vehicles as sold by insuring them, even though they were sold months later to actual customers.

Chinese media, including China Securities Journal, published similar allegations and reported that customers who purchased these vehicles, known as zero-mileage used cars, were denied refunds.

In a statement on Sunday, Zeekr said the vehicles in question were exhibition models that were insured but it did not sell or register them, Reuters reported Sunday in a separate report. The company said it has formed a special team to investigate the sales and make improvements, adding that it is opposed to the sale of zero-mileage used cars.

A spokesperson for Zeekr's majority owner, Geely, rejected the report by China Securities Journal but declined to comment on Reuters' findings, the outlet said.

Zeekr did not immediately respond to requests for comment from MT Newswires.

Zeekr shares were down over 3% in premarket activity.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)