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
- Foley & Lardner will host a
half-day Automotive Forum on Wednesday,
September 13, at the Detroit Athletic Club to coincide
with the 2023 North American International Auto
Show. Register HERE to attend the morning forum and hear more
about key business and legal issues impacting the automotive
industry.
- Foley & Lardner provided an overview of certain key issues for suppliers
to consider in preparing for a potential strike by the
UAW. The Union's contracts with General Motors, Ford,
and Stellantis are set to expire on September 14, 2023.
- Michigan Gov. Gretchen Whitmer is
communicating with automakers and the UAW in an effort to
avert a strike.
- The National Automobile Dealers Association (NADA) estimates total U.S. new light-vehicle
sales for the first eight months of 2023
are up by over 13% compared to the same period
last year.
- The seasonally adjusted annualized rate (SAAR) for
total new-vehicle sales reached 15 million units in
August, falling slightly short of analyst
projections.
- Cox Automotive estimates new-vehicle inventory
surpassed 2 million units at the start of September, up
from 1.96 million units at the beginning of August. According to
the analysis, inventory levels last exceeded 2 million units in
April 2021.
- Analysis from UBS predicts Chinese
OEMs could double their share of the global auto
market by 2030, due to factors that include an ability to
produce affordable EVs at a significant cost advantage in
comparison to Western automakers. (Full report requires
subscription)
- China exported 2.3 million passenger cars in
the first eight months of 2023, representing an
increase of 72% year-over-year, according to data from the China
Passenger Car Association excerpted in CNN. Roughly 25% of the exports were
EVs, and Europe was the top destination for vehicles made
in China.
- EVs now represent at least 5% of new car sales in 23 countries, marking a threshold that signals the start of broader adoption, according to analysis in Bloomberg.
OEMs/Suppliers
- GM
resumed pickup truck production last week at three North
American plants following full or partial shutdowns due
to parts shortages.
- Toyota set a global production target of 10.2 million vehicles for this calendar year. If achieved, this would mark the first time vehicles produced under the Toyota and Lexus brands surpass 10 million units in a calendar year.
Electric Vehicles and Low Emissions Technology
- Cummins, Daimler Truck and
Paccar will form a joint venture and invest up to $3
billion in a 21-gigawatt hour (GWh) factory in the U.S. to
manufacture batteries for commercial electric vehicles and
industrial applications.
- The U.S. Department of Energy
will provide $2 billion in grants and up to $10 billion in
loans to help auto companies convert existing factories
to produce hybrid and electric vehicles. The DOE will also
provide $3.5 billion in funding to expand domestic manufacturing of
batteries for applications including EVs.
- Hyundai and LG Energy
Solution will invest an additional $2 billion into an
upcoming battery cell manufacturing plant located
in proximity to the automaker's future EV manufacturing
facility in Bryan County, Georgia. With the announcement, the EV
and battery complex represents an estimated $7.59 billion
investment, and it will create up to 8,500 new jobs in the
region.
- Consumers have experienced a number of challenges with rental EVs,
including inadequate operating instructions, difficulty finding
charging stations, or receiving vehicles that are not fully
charged.
- Shortages of technicians and
independent repair shops qualified to fix EVs
could increase repair and warranty costs for drivers, according to
a report in
Reuters.
- CNBC reports electric
roads which allow drivers to wirelessly charge
vehicles while in motion could emerge as a potential
solution to supplement static charging.
- China's Gotion will build a new $2 billion EV battery
manufacturing plant in Manteno, Illinois.
- As part of an expanded agreement, Hilton will install Tesla Universal
Wall Connectors at up to 2,000 Hilton hotels and properties in
North America beginning in 2024.
- The pace of deploying charging infrastructure in California is insufficient to support the state's transition toward zero-emission medium- and heavy-duty vehicles, according to views from the California Trucking Association featured in Transport Topics. The article notes the construction of charging stations in the state can average 2-5 years or longer.
Automated, Autonomous or Connected Vehicles Technologies
- Passenger vehicles are described as the worst
consumer product category for data privacy in a
study by nonprofit Mozilla Foundation. The analysis indicates
that 84% of the 25 car brands in the study share or sell consumer
data, and it was not possible to confirm minimum security standards
for any of the brands.
- Tyson Foods will use Gatik autonomous
trucks to move certain products to its distribution and storage
facilities in northwest Arkansas.
- Former Argo AI founders are launching a new autonomous trucking startup, Stack AV, with backing from SoftBank Group.
Market Trends and Regulatory
- The U.S. Treasury Department intends to provide guidance by the end of 2023 on the Inflation Reduction Act's Section 45X Advanced Manufacturing Production Tax Credit. The tax credit is intended to incentivize domestic production in areas including EV batteries.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.