Archive · 16 Jun 2025
Chinese Suppliers Skeptical of Automakers' Payment Pledge
Chinese car companies promised to pay their suppliers faster (within 60 days).
This is good, but the companies have a history of taking longer to pay.
Suppliers are worried they won't actually get paid on time.
Some might use 'IOUs' (promissory notes) to delay paying.
The government is trying to help small businesses get paid faster too, but it's not clear if it will work.
Many suppliers, especially smaller ones, are struggling because of slow payments and tough competition.
Chinese carmakers pledge to pay suppliers within 60 days.
Suppliers are skeptical about carmakers' adherence to the payment pledge.
Some carmakers may use promissory notes to delay payments.
The government wants timely payments to small and medium enterprises.
Competition and payment delays cause difficulties for suppliers, especially smaller firms.
- Who
- Chinese carmakers and their suppliers.
- What
- Chinese carmakers' payment pledge to pay suppliers within 60 days.
- When
- Early June for the pledge, with regulations effective then as well.
- Where
- China
- Why
- To address scrutiny of slow payments and industry stress.
Carmakers View
Supplier View
Payment Speed
Carmakers View
Improve cash flow, support small businesses
Supplier View
Delay payments, issuing promissory notes.
- Payment Pledge Timeframe
- 60 days
- Participating Carmakers
- BYD Co., Zhejiang Geely Holding Group Co., SAIC Motor Corp., BAIC Motor Corp.
- BYD Dilian System
- Allows promissory notes
- BYD Net Debt Estimate
- More than 10 times higher than reported due to payment delays.
- Regulation Focus
- Ensure timely payments to small and medium enterprises.