Key facts
- China has implemented stricter guidelines to standardize payment practices between automakers and suppliers.
- The new rules aim to combat prolonged payment delays and the use of non-cash settlements.
- Regulators are warning of heavier penalties for non-compliance.
- The guidelines were jointly issued by the Ministry of Industry and Information Technology (MIIT) and the State Administration for Market Regulation.
- Despite a mid-2025 industry pledge to settle bills within 60 days, significant discrepancies and execution issues persist.
Chinese regulators have introduced more stringent guidelines aimed at standardizing payment practices between automakers and their suppliers. The new rules, jointly released by the Ministry of Industry and Information Technology (MIIT) and the State Administration for Market Regulation, are designed to close loopholes that companies have used to delay payments and engage in non-cash settlements.
An MIIT official acknowledged that while an industry-wide pledge made around mid-2025 to settle bills within 60 days had broadly improved payment times, significant discrepancies and execution issues persist across different automakers and their subsidiaries. The regulators are signaling increased penalties to combat these ongoing delays.