If vSphere cluster assigned 2 labels, e.g. us-east-1a(as zone when not hostgroups) and sgao-cluster-region(as region when host groups), install cluster(not host groups), label displayed wrong, see following sgao-cluster-region should be us-east-1,  sgao-host1-zone should be us-east-1a
# oc get machine -n openshift-machine-api
NAME                                 PHASE     TYPE   REGION                ZONE              AGE
sgao-vsphere7-cs8vb-master-0         Running          sgao-cluster-region   sgao-host1-zone   55m
sgao-vsphere7-cs8vb-master-1         Running          us-west-1             us-west-1a        55m
sgao-vsphere7-cs8vb-master-2         Running          sgao-cluster-region   sgao-host1-zone   55m
sgao-vsphere7-cs8vb-worker-0-2k6td   Running          sgao-cluster-region   sgao-host1-zone   49m
sgao-vsphere7-cs8vb-worker-0-phqg5   Running          sgao-cluster-region   sgao-host1-zone   49m
sgao-vsphere7-cs8vb-worker-1-w95nj   Running          us-west-1             us-west-1a        49m

tags in vSphere
# govc tags.ls
sgao-host1-zone      openshift-zone
us-east-1            openshift-region
sgao-cluster-region  openshift-region
us-west-1            openshift-region
us-east-1a           openshift-zone
us-west-1a           openshift-zone

failureDomains in install-config.yaml
...
    - name: us-east-1
      region: us-east-1
      zone: us-east-1a
      server: 10.185.151.12
      topology:
        computeCluster: /nested7-devqedatacenter/host/nested7-devqecluster
        datacenter: nested7-devqedatacenter
        datastore: /nested7-devqedatacenter/datastore/Datastore-10.185.151.13
        networks:
        - segment-884-ipv4-6-nested
    - name: us-west-1
      region: us-west-1
      zone: us-west-1a
      server: 10.185.151.12
      topology:
        computeCluster: /nested7-devqedatacenter-2/host/nested7-devqecluster-2
        datacenter: nested7-devqedatacenter-2
        datastore: /nested7-devqedatacenter-2/datastore/Datastore-10.185.151.14
        networks:
        - segment-884-ipv4-6-nested

# oc get node --show-labels
NAME                                 STATUS   ROLES                  AGE   VERSION   LABELS
sgao-vsphere7-cs8vb-master-0         Ready    control-plane,master   65m   v1.32.3   beta.kubernetes.io/arch=amd64,beta.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,beta.kubernetes.io/os=linux,failure-domain.beta.kubernetes.io/region=sgao-cluster-region,failure-domain.beta.kubernetes.io/zone=sgao-host1-zone,kubernetes.io/arch=amd64,kubernetes.io/hostname=sgao-vsphere7-cs8vb-master-0,kubernetes.io/os=linux,node-role.kubernetes.io/control-plane=,node-role.kubernetes.io/master=,node.cluster.x-k8s.io/esxi-host=10.185.151.13,node.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,node.openshift.io/os_id=rhel,topology.csi.vmware.com/openshift-region=sgao-cluster-region,topology.csi.vmware.com/openshift-zone=sgao-host1-zone,topology.kubernetes.io/region=sgao-cluster-region,topology.kubernetes.io/zone=sgao-host1-zone
sgao-vsphere7-cs8vb-master-1         Ready    control-plane,master   64m   v1.32.3   beta.kubernetes.io/arch=amd64,beta.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,beta.kubernetes.io/os=linux,failure-domain.beta.kubernetes.io/region=us-west-1,failure-domain.beta.kubernetes.io/zone=us-west-1a,kubernetes.io/arch=amd64,kubernetes.io/hostname=sgao-vsphere7-cs8vb-master-1,kubernetes.io/os=linux,node-role.kubernetes.io/control-plane=,node-role.kubernetes.io/master=,node.cluster.x-k8s.io/esxi-host=10.185.151.14,node.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,node.openshift.io/os_id=rhel,topology.kubernetes.io/region=us-west-1,topology.kubernetes.io/zone=us-west-1a
sgao-vsphere7-cs8vb-master-2         Ready    control-plane,master   65m   v1.32.3   beta.kubernetes.io/arch=amd64,beta.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,beta.kubernetes.io/os=linux,failure-domain.beta.kubernetes.io/region=sgao-cluster-region,failure-domain.beta.kubernetes.io/zone=sgao-host1-zone,kubernetes.io/arch=amd64,kubernetes.io/hostname=sgao-vsphere7-cs8vb-master-2,kubernetes.io/os=linux,node-role.kubernetes.io/control-plane=,node-role.kubernetes.io/master=,node.cluster.x-k8s.io/esxi-host=10.185.151.13,node.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,node.openshift.io/os_id=rhel,topology.csi.vmware.com/openshift-region=sgao-cluster-region,topology.csi.vmware.com/openshift-zone=sgao-host1-zone,topology.kubernetes.io/region=sgao-cluster-region,topology.kubernetes.io/zone=sgao-host1-zone
sgao-vsphere7-cs8vb-worker-0-2k6td   Ready    worker                 48m   v1.32.3   beta.kubernetes.io/arch=amd64,beta.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,beta.kubernetes.io/os=linux,failure-domain.beta.kubernetes.io/region=sgao-cluster-region,failure-domain.beta.kubernetes.io/zone=sgao-host1-zone,kubernetes.io/arch=amd64,kubernetes.io/hostname=sgao-vsphere7-cs8vb-worker-0-2k6td,kubernetes.io/os=linux,node-role.kubernetes.io/worker=,node.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,node.openshift.io/os_id=rhel,topology.csi.vmware.com/openshift-region=sgao-cluster-region,topology.csi.vmware.com/openshift-zone=sgao-host1-zone,topology.kubernetes.io/region=sgao-cluster-region,topology.kubernetes.io/zone=sgao-host1-zone
sgao-vsphere7-cs8vb-worker-0-phqg5   Ready    worker                 48m   v1.32.3   beta.kubernetes.io/arch=amd64,beta.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,beta.kubernetes.io/os=linux,failure-domain.beta.kubernetes.io/region=sgao-cluster-region,failure-domain.beta.kubernetes.io/zone=sgao-host1-zone,kubernetes.io/arch=amd64,kubernetes.io/hostname=sgao-vsphere7-cs8vb-worker-0-phqg5,kubernetes.io/os=linux,node-role.kubernetes.io/worker=,node.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,node.openshift.io/os_id=rhel,topology.csi.vmware.com/openshift-region=sgao-cluster-region,topology.csi.vmware.com/openshift-zone=sgao-host1-zone,topology.kubernetes.io/region=sgao-cluster-region,topology.kubernetes.io/zone=sgao-host1-zone
sgao-vsphere7-cs8vb-worker-1-w95nj   Ready    worker                 48m   v1.32.3   beta.kubernetes.io/arch=amd64,beta.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,beta.kubernetes.io/os=linux,failure-domain.beta.kubernetes.io/region=us-west-1,failure-domain.beta.kubernetes.io/zone=us-west-1a,kubernetes.io/arch=amd64,kubernetes.io/hostname=sgao-vsphere7-cs8vb-worker-1-w95nj,kubernetes.io/os=linux,node-role.kubernetes.io/worker=,node.kubernetes.io/instance-type=vsphere-vm.cpu-4.mem-16gb.os-unknown,node.openshift.io/os_id=rhel,topology.kubernetes.io/region=us-west-1,topology.kubernetes.io/zone=us-west-1a

    4.19.0-0.nightly-2025-04-17-154552

    always

    1. Install zonal cluster in vSphere where host groups tags existed
    2. Check region/zone label
    3.
    

    label wrong

    label should be correct