Bei Jing Shang Bao·2025-08-13 00:40Core Viewpoint - The automotive industry is responding to government initiatives to address "involution" competition by committing to a "60-day payment term" for suppliers, with initial results showing some companies successfully implementing these commitments [1][2][8]. Group 1: Commitment Implementation - Several automotive companies, including China FAW, GAC Group, and Seres Group, have begun to implement the "60-day payment term" commitment, showcasing their specific practices and results [1][2]. - China FAW has established a cross-departmental task force to ensure seamless management of payment processes, including revising contract templates to specify payment terms [2][3]. - GAC Group has developed a comprehensive control system that digitizes the entire payment process, allowing real-time tracking of order and payment statuses [3][4]. Group 2: Payment Methods - The payment method used by automotive companies significantly impacts the financial health of suppliers, with many previously relying on acceptance bills that extended payment periods [5][6]. - China FAW has shifted to 100% cash payments for recognized small and medium-sized suppliers, moving away from a mixed payment model [6][7]. - GAC Group has also prioritized cash payments, achieving a 95% cash transfer rate, which alleviates financial pressure on suppliers [7]. Group 3: Industry Trends and Effects - The automotive industry is witnessing a gradual return to healthy development, with a notable increase in production and sales, despite a decline in profit margins [8][9]. - The implementation of the "60-day payment term" and the reduction of price wars are contributing to improved industry stability, with a reported increase in industry profit margins [9]. - The government's "trade-in" policy and ongoing efforts to curb "involution" competition are showing positive effects on market stability and sales growth [9].