China Tightens Rules to Speed Automakers’ Payments to Suppliers

China’s regulators have rolled out stricter guidelines to standardize automakers’ payment practices with suppliers, warning of heavier penalties to combat prolonged delays and noncash settlements.

The guidelines, jointly issued Monday by the Ministry of Industry and Information Technology (MIIT) and the State Administration for Market Regulation, attempt to close loopholes that companies have exploited to delay supplier payments. An MIIT official said that while a mid-2025 industry pledge to settle bills within 60 days broadly improved payment times, significant discrepancies and execution issues remain among different automakers and their subsidiaries.