Analysis by Julie Dautermann, Competitive Intelligence Analyst
This update helps automotive suppliers inform their legal and operational decisions to help address challenges and opportunities. Contact your Foley relationship partner, or Ann Marie Uetz, Vanessa L. Miller, or Nicholas J. Ellis, to follow up.
Key Developments
- The most recent article in Foley
& Lardner LLP's Auto Trends 2023 Series shares insights
into product liability trends in areas
including electric vehicles, fully or partially autonomous
vehicles, and cybersecurity and data privacy safety. Click HERE to subscribe to the series.
- U.S. new light-vehicle sales are
projected to reach 1.31 million units in April, representing a SAAR
of 15.5 million units, according to a joint forecast from J.D. Power and LMC Automotive.
- Foley & Lardner provided an overview of a recently proposed rule from
the National Highway Traffic Safety
Administration (NHTSA) which impacts aspects of
the Whistleblower Program.
- Key findings from Deloitte's 2023 Automotive Supplier Study include
the potential for greater consolidation in the supply
base due to factors that include operational
challenges resulting from multiple crises over the past three
years, the ongoing effects of an inflationary environment, and the
industry's transition to electrification and software-defined
vehicles.
- Kelley Blue Book estimates over 250,000 electric
vehicles were sold in the first quarter of 2023,
representing 7.2% of U.S. new-vehicle
sales and an increase of nearly 45% from the first
quarter of 2022.
- Morgan Stanley analysis predicts established global automakers
will encounter a “more aggressive
push” from Chinese
automakers such as BYD to sell
competitively priced EVs outside of China.
- GM and Samsung
SDI will invest over $3 billion to build a
new electric vehicle battery plant at an unspecified U.S. location,
and the facility is expected to begin operations in 2026.The
automaker previously announced plans to operate three battery
plants in Michigan, Ohio and Tennessee with LG Energy
Solution through its joint venture, Ultium Cells
LLC.
- The percentage of subprime auto
borrowers in the U.S. who were at least 60 days late
on their bills recently surpassed levels experienced
in 2009 amid the financial crisis, according to data
from Fitch Ratings excerpted in Bloomberg.
- The Federal Communications Commission approved a waiver which allows certain applicants to deploy cellular vehicle-to-everything (C-V2X) technology on portions of the 5.9 GHz band prior to the adoption of final C-V2X-based rules.
OEMs/Suppliers
- GM reported net income of $2.4 billion on
revenue of $40 billion for the first quarter of 2023, compared to
$2.9 billion and $36 billion, respectively, for the same period
last year.GM attributed the Q1 2023 profit decline to
the cost of job cuts and reduced demand in China, and noted overall
results for the quarter surpassed its expectations.
- Toyota reported global sales of 9.61 million
units for its fiscal year which ended March 31, 2023, compared to
9.51 vehicles the previous year. The automaker did not provide
sales targets for its new fiscal year that started in April.
- Reuters reports Ford implemented
an intensive quality inspection
program at its Kentucky Truck plant in preparation
for the launch of the redesigned Super Duty pickup truck. CEO Jim
Farley previously expressed the need to improve quality and reduce
warranty costs as part of a broader effort to address cost disadvantages with certain
competitors. Ford will report first quarter earnings May 2.
- Bosch will acquire the assets of
California-based chipmaker TSI
Semiconductors, and invest another $1.5 billion to expand
production of silicon carbide chips (SiC).
- The Detroit News reports Stellantis will offer voluntary buyout packages to 31,000 hourly employees and 2,500 salaried workers, amid efforts to control costs and significant investments in vehicle electrification.
Electric Vehicles and Low Emissions Technology
- South Korean EV battery maker LG Energy
Solution announced its first quarter 2023
profit more than doubled, due to factors that include
increasing U.S. battery sales and Inflation Reduction Act
subsidies.
- The Wall Street
Journal reports rising global demand for
copper in applications that include electric vehicles
will lead to significant supply gaps of the metal
within the next decade.
- GM intends to stop
producing Chevrolet Bolt EVs at the end
of this year, amid plans to increase production of higher-margin
electric trucks.
- An upcoming Hyundai – SK On
joint venture battery plant in Bartow County, Georgia
will produce enough batteries each year to power 300,000
EVs.Initial plans for the $5 billion plant were announced in December 2022, and
operations are expected to begin in 2025.
- Volkswagen will invest over $7 billion CAD in an
upcoming battery cell plant in St. Thomas,
Ontario that will be operated by its
subsidiary PowerCo. The site location was
previously announced in March 2023, and it is expected to begin
operations in 2027. This will represent the second major battery
facility in Ontario following the $5 billion CAD Stellantis and LG Energy Solution plant, which
is expected to begin operations in 2024.
- Canadian EV charging company FLO will manufacture Level 3 fast chargers at
its Auburn Hills, Michigan facility, and ship them
nationwide.
- The University of Michigan and the
state have finalized a contract for
a $130 million Electric Vehicle
Center that was initially announced last year.
The Michigan Electric Vehicle
Center will focus on accelerating R&D, workforce
development, and “establishing advanced campus infrastructure
and facilities to support both research and education.”
- Stellantis announced an agreement to purchase battery-grade nickel and cobalt sulphate from Australia's Alliance Nickel Ltd. over an initial five-year period.
Automated, Autonomous or Connected Vehicles Technologies
- Autonomous technology developer May
Mobility will invest $18 million to expand its
headquarters and R&D presence in Ann Arbor, Michigan. The
company operates on-demand autonomous shuttle services in several
areas, including a retirement community in Arizona.
- Autonomous trucking company Kodiak Robotics and truckload carrier C.R. England launched a pilot program in April to ship certain Tyson Food products between Dallas and San Antonio, Texas.
Market Trends and Regulatory
- Law360 reports eighteen state
attorneys general asked NHTSA to recall
certain Hyundai and Kia vehicles which lack standard
anti-theft devices that insure car ignitions cannot
be started without their keys. The vehicles have experienced
elevated levels of theft as users of TikTok and other social media
platforms share information to facilitate break-ins.
- California regulators voted unanimously to adopt Advanced Clean Fleets, which requires medium- and heavy-duty truck operators in the state to phase in increasing levels of zero-emission vehicles.
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