Questions & Answers

What would trigger a default on my account? 

1. Unpaid invoices of over 90 consecutive days

Default is triggered for any unpaid and unjustified invoices when the absolute and relative materiality thresholds have been breached for 90 consecutive days (‘days past due’). Please note that the ‘days past due’ criterion will be applied retroactively from 1 February 2023:

• Relative threshold: 1% of total global exposure
• Absolute threshold: EUR 500

2. Indications of unlikeliness to pays

Default may also be triggered by an indication of unlikeliness to pay, if there is a significant decline in your company’s creditworthiness. Triggers include, among others, distressed restructuring, bankruptcy, fraud and/or contagion of default.

What happens if my company is classified as being in default?

• ALD Automotive and Société Générale’s central risk registers will be notified.

• ALD Automotive could, if required, suspend the delivery of cars ordered prior to the default or begin collecting cars that have already been delivered.

• New credit lines or the extension of existing credit lines will not be granted.

• Some restrictions on credit limits may apply.

How does my company return to non-default status?

• To be able to begin the probation period, thereby starting the process of returning to non-default status, there can be no observable default criteria.

• The probation period is a minimum regulatory period of 3 months, with the exception of distressed restructuring, where the minimum period is 1 year. During the probation period, your company remains classified as in default.

• During the probation period, your company will be monitored to ensure it has remained up to date with payments and/or has not triggered any unlikeliness to pay indicators.

• Once the probation period has ended, your company is flagged as sound and its creditworthiness status is reinstated.

What happens if I have a disputed invoice?

In the event that your company identifies an issue with an invoice which would delay or prevent its payment, we encourage you to contact our customer service department or your sales representative as quickly as possible to help resolve the situation.

In some circumstances, the new definition of default allows for exceptions to be made for disputed invoices, meaning that such invoices would not be taken into account for the classification of default. These circumstances include:

• Dispute validation provided by an independent, neutral ALD Automotive team (external or internal) in the event of a formal complaint.

• Legal proceedings to resolve a disputed invoice in a court of law.