Hyundai Motor Group will drastically shorten the payment deadline to partners to within 10 days and strengthen win-win cooperation across the supply chain by supporting various technology transitions. The judgment is that Hyundai Motor Group can speed up its future mobility shift, including artificial intelligence (AI), robots, and software-defined vehicles (SDV), only when partners' management stability and technological capabilities are in place.
Hyundai Motor Group on the 7th held the "Hyundai Motor Group win-win cooperation agreement signing ceremony" at DoubleTree Hotel in Pangyo, Seongnam, Gyeonggi Province. The focus is to strengthen the foundation for cooperation in the future mobility ecosystem and expand win-win cooperation together with the Korea Fair Trade Commission and first- and second-tier partners.
Korea Fair Trade Commission Chair Ju Biung-ghi and Executive Vice President for Corporate Planning and Coordination Seo Gang-hyun of Hyundai Motor Group attended. Also present were the heads of 12 affiliates, including Hyundai Motor, Kia, Hyundai Mobis, Hyundai Steel, Hyundai Engineering & Construction, Hyundai Rotem, Hyundai Engineering, Hyundai Transys, Hyundai WIA, Hyundai AutoEver, Hyundai Kefico, and INNOCEAN, as well as officials from about 150 first- and second-tier partners.
Hyundai Motor Group is pursuing a range of future businesses, including robots, software-defined vehicles (SDV), autonomous driving, future air mobility, hydrogen energy, and Smart Factory. Accordingly, the role of partners is expanding beyond a simple transaction relationship to supply chain partners preparing together for the transition to future industries.
Seo said, "The competitiveness of partners is the competitiveness of Hyundai Motor Group, and only when the entire supply chain is healthy can we all survive in the global market," adding, "We will pool the group's capabilities so that no partner is left behind alone in the process of transitioning to electrification, Autonomous Driving, robots, and software-centered future mobility."
First, Hyundai Motor Group will improve payment terms to provide a stable management base across the supply chain. The gist is to pay partners within an average of 10 days, shorter than the statutory payment deadline of 60 days. Through this, it plans to reduce the burden of cash management and enhance management stability.
It also decided to provide support such as training, monitoring, and incentives so that the payment due dates for payments from first-tier partners to second-tier partners can be shortened together.
Hyundai Motor Group also decided to actively use a win-win payment system to support stable payment collection within the supply chain. This system is a payment scheme operated based on the credit of the top purchasing corporations. Through this, first-, second-, and third-tier partners can sequentially cash out their supply payments early. Second- and third-tier partners can also procure funds at interest rates on par with large corporations, reducing the burden of financial expenses, and they can cash out supply payments more quickly.
Hyundai Motor Group plans to link first-tier partners' performance in using the win-win payment system to evaluations and incentive programs to support the system's spread to second- and third-tier partners. The Korea Fair Trade Commission (FTC) decided to provide incentives to corporations that implement the agreement.
On the day, Hyundai Motor Group affiliates also presented a range of support measures. Taking Hyundai Motor and Kia as examples, they will help partners transition their SDV, electrification, and Autonomous Driving technologies. Hyundai Mobis will foster advanced component technology partners, Hyundai Rotem will support the development of technological talent capabilities, and Hyundai AutoEver will provide AI training and support for obtaining certifications.
A Hyundai Motor Group official said, "We plan to raise the overall technology level of the supply chain by promoting the enhancement of partners' competitiveness and to grow the future industry ecosystem together with partners," adding, "We will continue practical support so that a fair and sustainable win-win cooperation culture can spread across the supply chain."