Photo courtesy of Anadolu
China has introduced stricter payment rules for electric vehicle and energy storage battery firms, extending its campaign against disorderly price competition to one of the country’s fastest-growing industrial sectors.
The China Automotive Battery Innovation Alliance and the China Energy Storage Alliance issued a payment cap on Monday covering both EV and energy storage batteries, aiming to strengthen supply-chain resilience and curb financial pressure on smaller suppliers.
Under the guidelines, buyers of materials and components must complete inspection and acceptance within seven working days after receiving goods.
Battery manufacturers must also limit payment terms for small and medium-sized enterprise suppliers to a maximum of 60 calendar days from delivery or formal acceptance.
Eleven major industry players, including Contemporary Amperex Technology Limited (CATL) and BYD’s Fudi Battery, have backed the initiative.
The move is part of Beijing’s broader “anti-involution” campaign, which targets excessive low-price competition, overcapacity, and weak profitability in key sectors, according to the South China Morning Post.
Authorities have increasingly sought to shift strategic industries from volume-driven expansion toward higher-quality growth, stronger pricing discipline, and more stable supply chains.
China’s Industry and Information Technology Ministry said upstream suppliers had been squeezed by heavy research and development costs and long payment cycles, weakening business confidence and supply-chain stability.
The payment framework follows a similar step in the auto industry. In June 2025, 17 major Chinese carmakers pledged to cap supplier payment periods at 60 days after intense price wars strained the sector. (Anadolu)