This report helps automotive suppliers inform their legal and operational decisions to help address challenges and opportunities. Contact your Foley relationship partner, or John R. Trentacosta or Ann Marie Uetz, to follow up.
Key Developments
- Foley & Lardner LLP Partner Vanessa Miller
is featured in a Q&A about "What We Must Do To Create Nationally Secure And
Resilient Supply Chains" with Authority Magazine
where she gives insights on how manufacturers and policymakers can
address recent supply chain challenges.
- Foley & Lardner Partners provided six strategies to enhance
global supply chain flexibility, beginning with
the contracting stage through daily operations.
- LMC Automotive estimates third-quarter
U.S. new light-vehicle sales were up by 2%, but
volumes for the first nine months of 2022 were down by 12% when
compared to the same period last year. Due to elevated risks
including vehicle affordability and "ongoing, but somewhat
improving, supply constraints," LMC adjusted its
full-year 2022 light-vehicle sales forecast to
13.7 million units, for a decline of 8% from 2021
volumes
- Cox Automotive and CNBC indicate rising interest rates
and inflation have become notable threats to consumer
demand for new vehicles.
- Analysts from UBS Group and RBC Capital Markets predictprofits for certain U.S. and
European automakers could drop noticeably in 2023, amid
market headwinds including inflation and economic
uncertainty.
- According to an S&P Global Mobility analysis, consumer loyalty to
automotive brands is currently at its lowest level in
three years, which may require action by OEMs and dealers to
minimize defections as the industry experiences a return to
stronger inventories.
- A cover story in Bloomberg Businessweek critiques the
timetable and feasibility of reaching fully autonomous
driving in passenger vehicles.
- Electric vehicles and low emissions
technology:
-
- A new whitepaper from the Center for
Automotive Research assesses the impact of the Inflation
Reduction Act's Clean Vehicle Credit provisions.
- Our Next Energy (ONE) intends to build a $1.6 billion electric
vehicle battery plant in Van Buren Township, Michigan.ONE's
batteries are built with lithium iron phosphate, and the technology
is believed to have benefits including longer drive times and
eliminating dependence on materials such ascobalt and nickel, which
are needed in lithium-ion batteries.
- Tesla delivered 343,830 vehicles in the third quarter of 2022, representing an
increase of approximately 42% from the same quarter last year, but failing to meet projected
volumes. The third quarter shortfall was attributed to increased
challenges with "securing vehicle transportation capacity at a
reasonable cost."
- The U.S. Environmental Protection Agency plans to streamline its review process for new
chemical substances used in applications including lithium-ion
batteries for electric vehicles.
- BloombergNEF predicts rising sales for electric vehicles will lead to a nine-fold increase in demand for manganese, and a 22% increase in demand for cobalt by the end of the decade.
- A new whitepaper from the Center for
Automotive Research assesses the impact of the Inflation
Reduction Act's Clean Vehicle Credit provisions.
Market Trends and Regulatory
- Show organizers announced the next annual North
American International Auto Show will be held in Detroit
on September 13-24, 2023, marking the second time the event will be
held in September instead of its previous January timeframe.
- U.S. House lawmakers
introduced the Shifting Forward Vehicle Technologies
Research and Development Act, which "reauthorizes the
advanced vehicle technologies program for R&D at the Department
of Energy for vehicle fueling, energy storage and workforce
development."
- Lobbying efforts to increase weight limits on U.S. roads are predicted to intensify, due in part to the need for the trucking industry to transport electric vehicles that are heavier than gas-fueled cars.
OEMs/Suppliers
- Third-quarter U.S. new light-vehicle sales
reflect mixed results among major automakers, including a 24%
increase for GM, a 16% increase for Ford, a 3% increase for
Hyundai, a 23% decrease for Nissan, a 7% decrease for Toyota and a 6% decrease for Stellantis, compared to the same quarter last
year.
- Ford will invest $700 million in its Louisville,
Kentucky plant to support production of F-Series pickup
trucks.
- The Wall Street Journal reports
Qualcomm has a pipeline of $30 billion in
auto-component supplier commitments, amid efforts to expand its
automotive business.
- GM revised a previously announced requirement for
salaried employees to work on-site three days a week, and stated
the change will not occur before 2023.
- Nissan and Renault are reported to be in discussions involving the future of their alliance partnership.
Connected/Autonomous Vehicles and Mobility Services
- According to the J.D. Power 2022 U.S. Mobility Confidence Index
Study, consumer readiness for fully-automated,
self-driving vehicles remains low, and consumers continue
to experience confusion about the terminology used to describe
different levels of automation. [Press release; full report not
publicly available]
- Intel-owned autonomous driving technology business Mobileye filed for an IPO with the U.S. SEC on September 30th.Intel acquired the Israel-based company for $15.3 billion in 2017.
Electric Vehicles and Low Emissions Technology
- Reuters summarized a number of recent
deals automakers have announced with suppliers and miners to
secure raw materials for electric vehicle
batteries.
- Ford plans to increase the price of the 2023 F-150
Lightning electric pickup by $5,000, as a result of supply
chain challenges and rising material costs. The automaker also
announced a price increase of $6,000 to $8,500 for the vehicle in
August.
- According to data excerpted in
Bloomberg, newly Hong Kong-listed EV battery
maker CALB Co. hopes to be ranked within the top
three battery makers globally within three to five years. The
company is currently ranked seventh among global battery
manufacturers.
- A number of electric vehicle and battery companies in
Asia have pursued IPOs and follow-on stock sales this year
to fund capital-intensive activities, according to a report in The Wall Street Journal.
- GM announced plans to increase Chevrolet
Bolt EV production for global markets to over 70,000 in
2023, compared to approximately 44,000 this year.GM sold 14,709
units of the Chevrolet Bolt EV and Bolt EUV, combined, in the third
quarter, representing the vehicles' highest quarterly volumes
to date.
- According to data excerpted in the Associated Press, approximately 13% of
new light-duty vehicles purchased thus far this year across the
federal government (excluding the USPS) were zero emissions. Last
year, the Biden Administration announced an executive order which included a
goal to achieve 100% zero-emissions light-duty vehicle
acquisitions for the federal fleet by 2027.
- Five multinational companies committed to transition their
medium- and heavy-duty truck fleets in OECD
markets, China and India to zero-emissions vehicles by
2040, as part of the EV100+ initiative announced by The Climate Group.
- Amazon plans to invest 1 billion euros to expand the
number of electric delivery vehicles it has in Europe to 10,000 by
2025, up from approximately 3,000 today.
- Electric van startup Arrival is reported to be
in discussions to raise capital to build and sell
its products in the U.S. Last month, the company produced its first production verification van at its
microfactory in the U.K.
- Tesla CEO Elon Musk announced the company will deliver its first Semi electric commercial trucks to PepsiCo in December.
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