Battery maker CATL rolls out supply chain finance platform
Published: Feb 2025
Best in Class Treasury Solution in China
Overall Winner
Contemporary Amperex Technology Co Ltd.
Deng Yuehong
Victor, Group Treasury Director
Contemporary Amperex Technology Co Ltd.
Contemporary Amperex Technology Co Ltd. (CATL) is a Chinese battery manufacturer and technology company that specialises in lithium-ion batteries for electric vehicles and energy storage systems.
The challenge
The development of new energy is a critical response to climate change. In 2023, the global electric vehicle (EV) battery industry saw continued growth with a 38.6% year-on-year increase. However, competition within the industry has intensified due to ongoing global economic fluctuations, industry restructuring and policy adjustments. Amidst this competitive industrial revolution, Contemporary Amperex Technology Co Ltd. (CATL) has been committed to addressing the core issues of safety, reliability and sustainable development in the application of green energy, continuously presenting outstanding products and solutions and fulfilling social responsibilities, such as ensuring the safety of its upstream supplier chains.
CATL has many multi-layer suppliers in China across many industries in the automotive ecosystem, who faced difficulties and issues due to the industry fluctuations such as:
High financing costs in the market as most are medium-size and small-size companies.
Lack of funding efficiency as credit relationship with banks is not as strong as CATL.
Lack of working capital efficiency and the need to shorten days’ sales outstanding (DSO) for better working capital management.
The solution
In 2022, CATL employed fintech company ZechFin to set-up its own digital supply chain finance (SCF) platform, and CATL invited its core banks as financing banks for its suppliers. CATL’s suppliers can now choose their preferred bank to discount their invoices resulting in lower financing costs and improved efficiency. Citi was invited to become a key financing bank of CATL’s suppliers. Citi then tailor-made the solution to accommodate CATL’s fintech SCF infrastructure and achieved host-to-host (H2H) connectivity with the SCF platform.
CATL SCF programme
Best practice and innovation
CATL is committed to building a globally competitive new energy industry ecosystem. The company works together with supply chain partners to build an innovative, collaborative, safe, efficient and green supply chain system, and continuously undertakes the quality-driven development of the new energy value chain.
Up to June 30th 2024, CATL group’s 15 subsidiaries (key buyers) have joined this SCF programme in the past two years. Over 2,200 suppliers have registered on this SCF platform and around 50% are CATL HQ’s 1st tier suppliers. There is now a total of 19 Chinese banks and foreign banks on CATL’s SCF programme as funding banks.
This SCF programme already helps save on the financing cost of CATL suppliers, which amounts to US$57.1m (RMB400m equivalent).
Key benefits
Cost savings.
Process efficiencies.
Return on investment (ROI).
Increased automation.
Improved visibility.
Errors reduced.
Manual intervention reduced.
Increased system connectivity.
Future-proof solution.
Exceptional implementation (budget/time).
Quality accreditation achieved.
Improved key performance indicator (KPI) metrics.
The Adam Smith Awards Asia are the industry benchmark for best practice and innovation in corporate treasury. The 2024 awards attracted 406 nominations. To find out more please visit treasurytoday.com/adam-smith-awards-asia
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