Written by Cláudio Afonso | LinkedIn | X
Tesla’s vice president of Government Affairs and PR for the Chinese market, Grace Tao-Lin, announced Thursday via the Chinese social media platform Weibo that the company has further reduced its payment cycle for supply chain partners this year in China to “around 90 days.”
In the post, the executive shared a Bloomberg chart from May, comparing Tesla’s payment cycle with the longer cycles of Chinese competitors BYD, Nio, XPeng, and Li Auto.
The graphic shows that BYD, Nio and XPeng have increased their payment cycle in China since 2021 while the new energy vehicle (NEV) maker Li Auto was able to reduce it to around 165 days in 2023, slightly down from 175 days in 2022.
In contrast with Li Auto, XPeng’s payment cycle rose to 221 days in 2023, compared to 179 days in 2021. BYD also saw its payment terms lengthen, taking 280 days in 2023 to settle payables, up from 220 days in 2022 and 200 days in 2021. Nio reported the longest payment cycle, reaching 295 days in 2023, an increase from 197 days in 2021, according to Bloomberg.
“We’ve confirmed this data: in 2024, our payment cycle for supply chain partners has been shortened again compared to last year, now taking only about 90 days,” Tesla’s executive wrote on Weibo.
Tao-Lin attributed Tesla’s success in this area to its robust local supply chain partnerships, noting that over 95% of the parts for the Shanghai Gigafactory are sourced from local suppliers. “Over 95% of the parts for the Shanghai Gigafactory are sourced from local suppliers. Tesla’s achievements in China and globally are inseparable from the contributions of these partners,” she said.
“By growing together with our supplier partners and enhancing efficiency while reducing costs through technological innovation, businesses can go further, industries can thrive, and consumers can continue to enjoy the best products,” Grace Tao Lin added.
Written by Cláudio Afonso | LinkedIn | X
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