On February 12, the China Association of Automobile Manufacturers (CAAM, hereinafter) issued the Research Report on the Implementation of Payment Term Commitments for Suppliers of Key Automobile Enterprises.

The report highlights that the CAAM recently undertook research and analysis regarding the commitment fulfillment of 17 automobile enterprises. The findings reveal that the majority of these key enterprises have streamlined their payment terms to within 60 days, with an average payment period of roughly 54 days—approximately 10 days shorter than the same period in the previous year. Notably, four enterprises boast an average payment term of under 50 days.

A brief recap: In June 2025, in response to the implementation of the revised Regulations on Ensuring Payments to Small and Medium-Sized Enterprises by the State Council, 17 prominent automobile enterprises, including GAC Group, China FAW Group, Dongfeng Motor, Seres, Geely Auto, Changan Automobile, BYD, Chery Automobile, XPENG Motors, Great Wall Motors, Xiaomi Auto, BAIC Group, Leapmotor, Li Auto, NIO, SAIC Motor, and JAC Group, publicly pledged that their “payment terms for suppliers will not exceed 60 days.” Some enterprises further committed to discontinuing the use of “commercial acceptance bills.”

In September 2025, the CAAM unveiled the Initiative on Standardizing Supplier Account Payments for Automobile Manufacturers, outlining specific recommendations for handling key processes such as order confirmation, delivery and acceptance, payment and settlement, and contract duration.

According to the research report, regarding payment methods, all 15 enterprises utilize cash or bank acceptance bills, with a few still employing commercial acceptance bills. Two enterprises have adopted electronic payment vouchers for accounts payable but have pledged to phase them out gradually. Five enterprises boast a cash payment ratio exceeding 50%, with two surpassing 70%.

In terms of preferential treatment for small and medium-sized enterprises (SMEs), the 17 key enterprises have set payment terms for SMEs to commence from the delivery and acceptance of goods, ensuring that the “entire process” from acceptance to payment does not exceed 60 days. Fourteen enterprises have implemented additional preferential policies for SMEs.

However, the CAAM also pointed out that some automobile enterprises still face challenges regarding the payment of supplier invoices. For instance, there are discrepancies in determining the start of the payment term, such as delivery and acceptance of goods, centralized reconciliation, receipt of invoices, and loading verification. Although all nominally adhere to a 60-day payment term, the time lapse for suppliers from delivery to receipt of payment varies significantly, indicating insufficient standardization in process management and leading to de facto extensions of the payment term. A few enterprises even demand that suppliers reduce product prices or accept other unreasonable terms under the guise of shortening the payment term.

It is crucial to note that the payment term mentioned in the research refers to the duration from the commencement of the payment term (acceptance, reconciliation, etc.) to the enterprise's payment (cash, bank acceptance bills, etc.).